What are ethics?Professional Insurance Agents of VA & DC

What are ethics?

• Standards of right and wrong; good and bad

• A set of principles of right conduct.• Theory or system of moral values• General nature of morals and moral

choices• Rules or standards governing conduct

or a profession

Ethical Behavior

• Based on morals, laws, and ethics• Morals entail making the distinction

between right and wrong.• Laws are legal tenents.• Ethics entail knowing what to do when

a situation presents more than one “right” answer.

3 Basic Methods of Examining Ethics

• Metaethics – where our ethical principles come from & what they mean

• Applied Ethics – examining specific controversial issues

• Normative Ethics – to arrive at moral standards that regulate right & wrong conduct

Ethics involve consideration for duty and for what is the right response when a conflict arises. Ethics are, in essence, codes of expected behavior that apply in the absence of laws.

Ethics are derived from morals and are applied when a purely moral response might not be ultimately appropriate.

Contradictory laws or societal norms set up conflicts that must be resolved in an ethical manner.

Searching for Ideal Behavior

The Golden Rule:

“Do unto others as you would want others to do unto you!”

Searching for Ideal Behavior

Virtue – develop good habits of character• Wisdom• Courage• Temperance• Justice• Fortitude• Generosity• Self-Respect

Searching for Ideal Behavior

Duty – Clear Obligations:• Duties to your God: inward and outward

practice of your individual faith• Duties to Oneself: developing ones’ own skills

and talents; to not harm ourselves• Duties to Others: not to cause harm, respect

others

Avoid wronging others

Treat people as equals, promote the good of others, keep one’s promises.

Our rights

Justified claim against another person’s behavior – our right not to be harmed, payment of debt, life, health, liberty or possessions.

Thomas Jefferson’s 3 Foundation Rights:• Life• Liberty• And the pursuit of happiness!

Our actions

Treat people as an end, and never as a means to an end.

Treat people with dignity and respect and not as an instrument for our end goals.

Moral convictions

• Fidelity – duty to keep promises• Reparation – duty to compensate others

when we harm them• Gratitude – duty to thank those who help us• Justice – duty to recognize merit• Beneficence – duty to charitable acts• Self Improvement – duty to improve our

virtue & intelligence• Non-malfeasance – duty not to injure others

Influence on Ethical Behavior

Individual values significantly influence ethical behavior.

Values are what one believes. Define what is important. A strong factor that influences which “right” answer one chooses.

Ethics are what one does.

Business Ethics

In reality, they are applied ethics. The insurance professional must embrace moral values, be aware of applicable laws, rules, and regulations, and then apply those values and rules to a given situation.

Entail making optimal choices in the workplace & doing what’s right in context of products & services & relationships with stakeholders.

Consequential Behavior

• Judges that an action is morally right if the consequences of that action are more favorable than unfavorable.

• Add up the good vs. the bad• Decide if the good outweighs the bad

The Three R’s

• Respect• Responsibility• Results

Respect

• Treating customers, co-workers, managers, etc. with dignity, courtesy and respect.

• Using business supplies, equipment, time, money appropriately, efficiently and honestly, for business purposes only.

• Protecting & improving your work environment – abide by laws & rules to protect us and our environment.

Responsibility

• Provide timely, high-quality goods and services.

• Work alongside your co-workers and carrying your share of the load.

• Meet all performance expectations and add value.

Results

“The end justifies the means” is an excuse, not a reason for acting improperly or unethically.

Are you acting ethically?

• Compare actions to the Golden Rule• Would you want your peers to know

your actions?• What about family, friends, neighbors,

church, the media?

Ethical Dilemma – What would you do?

• The Claim Adjuster• The Conflict• The Resolution

•Think through each conflict situation, bearing in mind the codes of expected behavior, ethical guidelines, and moral values.

•Ethical decisions originate from reasoned consideration of all the issues surrounding a conflict.

Ethics Requires…

Universal Standards

• Laws and Regulations• Public and Employee Safety• Truthfulness of records and statements

What qualifies as an unethical act?

• Falsehoods• Stretching the truth• Misrepresentation• Misappropriation of monies• Unfaithful to promises• Sharing confidential information• Breaking contracts• Putting your interests before others

Unethical acts = short term gains

• Instant gratification; later regret• Are you in this for the long haul?• Is your reputation important to you?• What legacy would you like to leave?

Why are ethics important to our industry?

• Proper premium for identified risks• Claims have direct effect on premium

& coverage availability• Honesty in dealing with customers• Honesty in dealing with carriers• Accepting responsibility for our actions• E&O potential• Insurance Industry Reputation

Agent Owes Insurance Company

• Loyalty• Good Faith• Reasonable Care• Contractual Duties

Agent Owes Customers

• Adequate Coverage• Proper Coverage• Coverage placed in the best interest of

the customer• Coverage placed with a financially

sound carrier• Prompt communication

Ethical Dilemma – What would you do?

• Commission• Short Investigation• Contingent Commission

Talk the Talk ~ Walk the Walk

• Everyone else does it• They won’t miss it• Nobody will care• The boss does it• I don’t have time to do it right• That’s close enough• Some rules were meant to be broken

Talk the Talk ~ Walk the Walk

• They owe it to me anyway.• Its not my job.• I won’t make my sales goal this month

if I don’t tweak the truth a little.

Act within your authority

• Actual or Expressed• Implied• Apparent

Examples ~ Scenarios

Ethical Dilemma

Situation – A co-worker proposes an action that you believe is not ethical or downright wrong.• What do you do?• Do you tell your employer or partner?

•You may be tempted to do what is asked because you know the person or you feel obligated for some other reason.

•Are you looking at doing this questionable action simply to “go along to get along”?

•If so, you would be knowingly be doing what you believe is unethical.

That makes you as wrong

as the other person!

Fight the temptation.

Take a stand.

Say NO, with tact.

Here’s how…..

First, don’t accuse the other person of being unethical. Instead, use “I” statements to describe your feelings.

State your objection & concern

• I have serious concerns about that and I need your understanding as to why I can’t do….

• I honestly believe it is wrong because…• I can’t do what I feel is wrong…

Propose Alternative Action

• I think I know what you’re trying to accomplish, and I think we can do this a better way…

Ask for Help & Agreement

• I really need your help…• I want to make sure we both do the

right thing…• Will you go with me on this one?

Situation

• Your producer tells you to leave out some pertinent information on the application.

• What do you do?• Do you tell your employer or manager?

•You may be tempted to do what he asks because you fear the loss of your job.

•First, let the producer know of your dilemma.

•Next, practice the same process as given in the first situation.

If you are not successful, go to a higher authority!

Words of Wisdom

• Keep true, never be ashamed of doing right, and decide on what you think is right and stick to it. ~ George Eliot

• If you don’t stand for something, you will fall for anything. ~multiple sources

• To know what is right and not do it is the worst cowardice. - Confucius

Words of Wisdom

• Honesty is the cornerstone of all success, without which confidence and ability to perform cease to exist. ~ Mary Kay Ash

• It is not who is right, but what is right, that is of importance. ~ Thomas H. Huxley

Words of Wisdom

• We may be personally defeated, but our principles never. ~ William Lloyd Garrison

• Nothing can stop the man with the right mental attitude from achieving his goal; nothing on earth can help the man with the wrong mental attitude. ~ Thomas Jefferson

Words of Wisdom

• We are what we repeatedly do. Excellence, therefore, is not an act but a habit. ~ Aristotle

Thank You!

• Please sign the Sign Out Sheet for your CE credit.

• Please complete the Class Evaluation.

• Now, go and do the right thing!