Ethics at work
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unethical behaviors may cause what 2 things to insurance professionals?
higher premiums for E&O insurance and hurts the customers (also legal trouble possibly)
what are 2 benefits of ethical behavior?
more successful career and clients like dealing with people that they trust!
ethical behavior is always part of the ______?
insurance professionals need to obey both the _____ and _____ of insurance laws!
letter and spirit
what is contract of adhesion?
- terms are drawn by insurer
- insureds do not have much say so courts will interpret and unclear wording in policy
what is contract of utmost good faith?
insurance comp. relies on integrity of applicant when issuing policy.. in return insured relies on company to provide coverage to future claims
what is contract of indemnity?
when loss takes place individual should be returned to the approximate financial condition that he or she was in before the loss ** no more no less **
is it possible for legal action to be unethical?? example
yes! woman gives policy that cost little more and gives her commission... still legal just not ehtical
what are set to only minimally acceptable standards of conduct?
what is honesty??
- telling the truth
- make sure that others get what entitled to and do not accept things that they are not entitled to
what is integrity??
doing the right thing regardless of situation! take risk for being honest
what is responsibility??
- reliable and trustworthy
- customers rely on us to determine best policy, obtain right coverage at best price, and interpret policies to ensure that claims are paid. we have specialized knowledge that is not accessible to or understandable to many costumers
what is caring?
enables us to act in best interest of insured. our work helps protect people from disasters. we treat people the way that we want to be treated.
what is courage?
need to stand up to people to make ethical decisions. a party may be at minor loss due to ethical stance
what is excellence??
being outstanding. gains made in ethical manner gain respect from all people. will be more successful in career as well
property-casualty insurance contribs to the _______ well being of society so it is insurance is considered a ______ ______ industry.. as result consumers have some say in how it is conducted.
what does competition show?
that prospering companies also have the best services for its customers fitting their needs at best price.
most businesses competition alone is enough to protect public interest but not insurance b/c of what 2 factors??
- complex nature of insurance
- long-term nature of insurance
insurance is a complex product meaning its hard for people to understand and presents opportunities wherein clients can be taken advantage of such as... (4)
- coverage misinterpreted
- entitled coverage is denied
- policy lingo deliberately obscure so people dont know what they are buying
- polices may be priced too high or too low
what does the long-term nature of insurance mean in terms of opportunities for customer abuse?
abuses can go on for years undetected -> may be many years paying insurance before asked to pay a claim. act of faith by customer. even if policy is clear still need to trust that the company will fulfill policy
why is underpricing policies worse?!
money taken in is used to pay potential claims. if does not take enough it cannot pay the claims when they do take place. since claims may take while to build companys poor financial situation may not be present for years.. when catch up its stressing on 3rd party claimants and first party insureds
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