In this final rule, the Postal Service adopts an amendment to Domestic Mail Manual standards governing insurance advertising in Nonprofit Standard Mail. The amendment sets forth guidelines for determining whether the coverage provided by an insurance policy offered by an authorized nonprofit organization to its members is not generally otherwise commercially available.
Effective September 8, 2004.Start Further Info
FOR FURTHER INFORMATION CONTACT:
Jerome M. Lease, Mailing Standards, United States Postal Service, 202-268-7264.End Further Info End Preamble Start Supplemental Information
In a proposed rule published in the Federal Register on June 15, 2004 (69 FR 33341), the Postal Service proposed an amendment to Domestic Mail Manual (DMM) E670.5.5, which provides guidelines for determining whether insurance solicitations are eligible to be mailed at Nonprofit Standard Mail rates (“nonprofit rates”). The Postal Service has determined to adopt the proposed amendment. The change sets forth additional circumstances where the coverage provided by a general type of insurance, such as homeowner's, property, casualty, marine, and professional liability, would be considered not generally otherwise commercially available and, accordingly, mail promoting that coverage would be eligible to be mailed at Nonprofit Standard Mail rates.
Mailings permitted at nonprofit rates according to the policies in effect since 1991 will continue to be eligible for the nonprofit rates. These include, as discussed in the proposal, material promoting charitable gift annuities and material promoting insurance to a target group that does not otherwise have a source to obtain that type of coverage. The change amends the DMM to clarify that section E670.5.5 does not restrict the use of the nonprofit rates for mailings of an authorized fraternal benefit society or any other nonprofit organization when the material advertises, promotes, or offers insurance that is underwritten by the nonprofit organization itself. Nor does it restrict the use of the nonprofit rates for mailings of an authorized organization's material that advertises, promotes, or offers insurance, if the coverage is provided or promoted by the nonprofit organization to its members, donors, supporters, or beneficiaries in such a way that those parties may make tax-deductible donations to the organization of their proportional shares of income in excess of costs that the nonprofit organization receives from the purchase of the coverage by its members, donors, supporters, or beneficiaries. The changes take into account court rulings, the Postal Service Appropriations Act of 1991, and related legislative history.
As explained in the proposal, mailings that are ineligible for Nonprofit Standard Mail rates under the cooperative mail rule or other standards remain ineligible for nonprofit rates, regardless whether they violate the amended standards related to insurance. Moreover, mailers continue to bear the burden to substantiate that mailings qualify for nonprofit rates, and may be asked to provide evidence to support eligibility for those rates before a mailing is accepted.
The Postal Service received one comment concerning its proposal. This comment supported the amendments proposed by the Postal Service.
Accordingly, for the reasons explained here and in the notice proposing the amended standard, the Postal Service adopts the rule as proposed.Start List of Subjects
List of Subjects in 39 CFR Part 111End List of Subjects Start Part
PART 111—[AMENDED]End Part Start Amendment Part
1. The authority citation forEnd Amendment Part Start Amendment Part
2. Revise theEnd Amendment Part
E600 Standard Mail
E670 Nonprofit Standard Mail
5.0 ELIGIBLE AND INELIGIBLE MATTER
5.5 Definitions, Insurance
[Revise 5.5 to read as follows:]
For the standard in 5.4b:
a. Except as specified in 5.5c, the phrase not generally otherwise commercially available applies to the actual coverage stated in an insurance policy, without regard to the amount of the premiums, the underwriting practices, and the financial condition of the insurer. When comparisons are made with other policies, consideration is given to coverage benefits, limitations, and exclusions, and to the Start Printed Page 54006availability of coverage to the targeted recipients. When insurance policy coverages are compared to determine whether coverage in a policy offered by an organization is not generally otherwise commercially available, the comparison is based on the specific characteristics of the mailpiece recipients (e.g., geographic location or demographics).
b. Except as specified in 5.5c, the types of insurance considered generally otherwise commercially available include, but are not limited to, homeowner's, property, casualty, marine, professional liability (including malpractice), travel, health, life, airplane, automobile, truck, motorhome, motorbike, motorcycle, boat, accidental death, accidental dismemberment, Medicare supplement (Medigap), catastrophic care, nursing home, and hospital indemnity insurance.
c. Coverage is considered not generally otherwise commercially available if either of the following conditions applies:
(1) The coverage is provided by the nonprofit organization itself (i.e., the nonprofit organization is the insurer).
(2) The coverage is provided or promoted by the nonprofit organization in a mailing to its members, donors, supporters, or beneficiaries in such a way that the members, donors, supporters, or beneficiaries may make tax-deductible donations to the nonprofit organization of their proportional shares of any income in excess of costs that the nonprofit organization receives from the purchase of the coverage by its members, donors, supporters, or beneficiaries.
An appropriate amendment to 39 CFR part 111 will be published to reflect these changes.Start Signature
Neva R. Watson,
[FR Doc. 04-20185 Filed 9-3-04; 8:45 am]
BILLING CODE 7710-12-P