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Ethics In The Insurance Industry

This is the presentation that Ted Pappas used when he was chosen to speak at the NAMIC (National Association of Mutual Insurance Companies) Commercial Lines Seminar on February 28 th , 2008 in Chicago. Ethics In The Insurance Industry. Theodore M. Pappas, CLU, CIC, CWCA.

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Ethics In The Insurance Industry

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  1. This is the presentation that Ted Pappas used when he was chosen to speak at the NAMIC (National Association of Mutual Insurance Companies) Commercial Lines Seminar on February 28th, 2008 in Chicago.

  2. Ethics In The Insurance Industry Theodore M. Pappas, CLU, CIC, CWCA

  3. Ethics Awareness Month for the Insurance Industry MARCH

  4. What We Sell NOTHING But A Promise

  5. OUR PROMISE: To pay a claim in the event of an unknown contingency

  6. To Sell An Intangible All you have is your credibility and perceived honesty

  7. What Do We Know About Our Industry? Eventually you will be between a rock and a hard place

  8. “Perhaps THIS Will Refresh Your Memory”

  9. We have a fear that there are a finite number of customers “Entrepreneurs have this horrifying sense of scarcity, that the customers they have, are the only ones in the world” • G. Richard Shell • Prof. Of Legal Studies & Management • Wharton School, • University of Pennsylvania

  10. Defending an E&O claim is… …A Liars Contest

  11. Your Reputation, Past ethical behavior, will be the key issue

  12. If you have a history of : Misrepresenting a risk, being creative in rating a risk or – simply ignoring the rules

  13. That will be used to discredit you

  14. REMEMBER A jury of your peers has absolutely no idea how or what you do for a living

  15. If the opposition can demonstrate you are less than ethical…

  16. “Touche!”

  17. ETHICS:A system of moral standards or values

  18. ETHICS:Rules or standards governing the conduct of a person or members of a profession

  19. Easy To Define? Different people and different organizations have different standards and values

  20. An action considered ethical by one may not be considered ethical by another

  21. Early on we learned it is wrong to kill

  22. In time of war? Capital Punishment? To steal to feed your children?

  23. If it’s difficult to answer these questions covered by rules or laws, it’s more difficult to answer business ethical questions

  24. Business Choices Not between Right and Wrong… …but between 2 RIGHT answers

  25. LAW:Minimum Standard

  26. Ethical BehaviorAbides by the spirit of the law

  27. Qualities Society Views as Ethical: Honesty Integrity Responsibility Respect Courage

  28. Ethical Decision: Make best choice in compliance with duty Rather than the best choice for him or her personally

  29. Primary Cause of Unethical Behavior Conflict of Interest

  30. Conflicts of Interest Do not equate to unethical behavior Think of them as temptations to resist

  31. Conflicts of Interest Arise from unique circumstances Relationships BusinessArrangements Not known to the other party

  32. TRANSPARENCY-Eliot Spitzer

  33. Impossible to eliminate all conflicts of interest

  34. Acting Ethically “Doing The Right Thing”

  35. What are my legal duties and contractual obligations?

  36. What benefits, what costs or harms each course of action produce? Which alternative leads to best overall results?

  37. Does one course of action best respect the moral rights of all?

  38. Is one course of action fairer to all the parties than are the others?

  39. Examples of Ethical Behavior:

  40. Only making promises you can keep Fulfilling all promises you make, or explaining why they can’t be fulfilled Honesty in all communications

  41. Stay within your area of expertise Never oversell your knowledge or abilities Disclose bad news timely Disclose unavoidable conflicts of interest Work through proper channels

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