Do brokers need lessons in ethics? The United States seems to think so as 34 states require all licensed insurance producers to attend an ethics class.
Insurance brokers are required to take three hours of ethics every two years. American broker Brent Kelly attended his third ethics class recently and says every time he goes, he finds himself questioning why he is required to attend.
“Here's the reality. I face ethical issues every single day in my business. I think I'm ethical. You probably think you are ethical too but are you are you always ethical?
“As much as may think you are, I guarantee you are not. I don't mean you are unethical in terms of a serious offence like fraud or embezzlement, but in small actions that could lead to greater consequences. ”
Kelly says for a broker, ethical dilemmas are a way of life and having multiple obligations is one of the biggest issues brokers face.
“As a broker, you have obligations to your clients, obligations to your agency, and obligations to the insurance companies but who do you serve first?”
He says the obvious and most common answer is the client, but is that always the right answer?
“What if your client asked you the bend the truth a little? What if the client asked you to go ahead sign that paperwork on their behalf? What if the client told you something ‘off the record’? The reality is that clients (the ones who pay your salary) will often put you in the most difficult ethical positions.”
There is no clear answer, Kelly says.
“Every situation is different and every experience is unique. That being said, every state and insurance department has rules. Whether you like those rules or not, you better be aware of them and know them.
“You will undoubtedly face ethical decisions every day. Some are easier than others, but when it comes to clients it can become tricky as your clients are your lifeblood, can become good friends and you care about your clients.”
But Kelly stresses it does not mean clients have the right to put their brokers in a difficult position. Brokers must follow the rules.
“If you follow your instinct, follow your moral principles, and follow the rules, you will have a much easier time making those tough ethical decisions.
“I don't know that ethics can ever be regulated. That being said, every insurance professional needs take to time reflect on past decisions and prepare yourself for future ethical dilemmas.”
