Rules for Social Media Giveaways
Question: “I was hoping to get some clarity on any kind of rules in regards to promotions/giveaways on our social media accounts to grow our followers? For example, running a giveaway contest with the way to enter being to follow our accounts, then the winner is selected at random. There is nothing to do with sending clients or referrals, it is simply that you follow our Facebook/Instagram pages, and you are entered to win a prize.”
Answer: The NYS Department of Financial Services has issued a number of advisory legal opinions on raffles and giveaways over the years, but this one from October 31, 2003, seems to best fit what you described:
Whether a raffle ticket would be considered an unlawful rebate will depend on a number of factors. A ticket for a raffle held by either an agent or a broker, or a third party, that meets the following conditions would not be considered an unlawful rebate. If the raffle is “open”, meaning anyone may enter this raffle, and entry into the raffle is not tied to the purchase or solicitation of an insurance product, then a ticket for such a raffle would not be considered an unlawful rebate because there is no prohibited inducement or tie-in to an insurance contract. [Emphasis added]
Based on this, it sounds like what you’re proposing is permissible.
Read the complete text of the opinion here.
For more information on this topic, visit the Rebating & Discrimination page in the Answer Center of our website.
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