Compliance Considerations when Using Direct Mail in Finance


Businesses in the financial services industry depend on their credibility to get business, Stability, trustworthiness, and integrity are top factors that keep those brands going in the market. Any financial organisation that fails to earn these things is likely to incur losses. Therefore, it is important that these qualities are strongly communicated to the audience. 

Mostly, the communication is complicated - it’s not easy to reach out to your audience - all at once to promote your brand or convince them to trust your brand. 

People will deal only with those companies which they find trustworthy and honest, and whose services they find useful. The bank direct mail marketing helps in connecting with the audience personally and showing them they are important and their contribution is valuable to us. 

Most service providers use direct mail to communicate about their services or products clearly and gain the trust of people. According to a US survey, about 88% of purchase decisions regarding financial, auto, and retail sectors are discussed and finalised at home. There’s no difficulty to say that direct mail can start a conversation with its shareable nature and push more and more audiences to respond to it. 

But direct mail is not just a send-and-forget thing. You need to be aware of what limitations to follow before or while sending a direct mail piece. These limitations prove that direct mail marketing for insurance agents should be organised with professional support. 

Here’s the list of federal laws you should send before sending a mail piece: 

Laws regarding direct mail marketing 

The state and federal governments continuously make efforts or take steps to secure the personal information of US citizens. Federal mail laws and other laws regarding direct mail marketing were passed to allow consumers to their marketing efforts. 

Generally, direct mail marketing has various federal laws and regulations regulating it. These include: 

  1. The DMPEA (39 U.S.C., Section 3001) 

According to the Deceptive Mail Prevention and Enforcement Act (DMPEA), non-governmental organisations are not allowed to send solicitations that involve a connection with a federal government for the purchase of services or products. It also restricts mailing insensitive materials to those who refused to receive mail with prior notice to the postal service. 

The USPS has the power to protect the audience against deceptive mailing with games of chance, facsimile checks, games of chance, sweepstakes, and skills contests. All mailings with contest entries must include the name and address of the sponsor, detailed rules with all terms and conditions, the prize value, and the numeric chance of winning it. 

Ensure that you mention to include a disclosure that explains that a purchase has no impact on the odds of winning the prize. Besides, if you implement financial advisor postcard marketing and send large volumes of contest mailings or sweepstakes, you should establish a name removal system to permit opting out. 

  1. The Theft or Receipt of Stolen Mail Matter (Title 18 U.S.C., Section 1708) 

This law punishes citizens that steal, take abstract, or obtain by deception/fraud any mail piece. Those who attempt to commit such a crime can be fined or imprisoned for up to five years. Although such federal mail laws don’t impact direct mail advertisers, they impose additional responsibility for mail accuracy. Third-party advertisers, for quality mailing services, should make sure that they control the data processing and mailing processes. 

In addition, with automation in direct mail for banks, you can track if the recipient received the mail. This will help to prevent and detect mail fraud or theft. 

  1. The Health Insurance Portability and Accountability Act 

The HIPPA Act was signed in 1996 to protect the medical information of US citizens and modernise the processing of patient records. It restricts sharing mailing lists used by the medical facility. You can use your own list of patients to send direct mail offers until they request to stop. 

Also, ensure that medical information will be delivered only to the intended consumers. Certified mail is one of the ways to achieve this. Or as an alternative, you can include a QR code or a personalised URL (pURL) that will forward the recipient to their profile with all the required details. 

  1. National Do Not Mail List 

The Direct Marketing Association (DMA) provides the National Do Not Mail List that allows the audience to not receive unwanted mail. It is used to opt out of telemarketing services. Do Not Mail List helps people share their mail preferences and stop receiving spam or junk mail. A customer only has to mention their name and address in the database and then all DMA members update their mailing lists to remove the specific person. 

Even though the National Do Not Mail List seems to limit mail marketers, it can benefit them. It saves the audience from furious customers irritated by receiving marketing emails. Therefore, these companies can make their insurance direct mail marketing more targeted and remove extra mailing costs. 

This is not a complete list of federal mail laws for direct mail marketing. If you want to launch regular direct mail campaigns and deal with medical records for insurance, sensitive consumer data, or credit card details that are strictly regulated, you can consult with mailing professionals who can help you get the job done. 

Final Thoughts 

If you choose to cooperate with USPS, you will be provided with a detailed set of requirements and mail templates. Such templates include information that must be included in a mail piece. In addition, as a governmental body, the USPS is committed to meeting all the requirements of state and federal laws. It has strong internal security measures and conducts regular employee training to protect consumer data. 

But before sending out mail, mailing vendors need to be aware of how to get the most out of direct mail complying with laws regarding direct mail. They can turn mail marketing into an effective marketing tool with stronger data privacy, resulting in increased insurance direct mail response rates than other marketing channels. 

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