Ethics and Insurance: Evaluating Business Practices

A regard for ethics should be at the heart of every business transaction, and ethical behavior and honesty should be the first priority of any insurance agent or broker. Clients place a great deal of trust in their agents and brokers to conduct business on their behalf. They rely on these advisors to protect company assets and conduct business with integrity.  Ethical business practices must be embedded in organizational culture.

Ethics are codes of conduct that set out expected behaviors. Insurance agents and brokers should make decisions with a client’s best interests in mind. Put simply, ethics is knowing the difference between what you have a right to do — and what is right to do.
         
One way to determine if an insurance provider is “doing the right thing” is through a general insurance review. This analysis should examine insurance coverage, broker services and premium levels, and include an assessment of the incumbent agent or broker’s business practices.
         
Following the review, if an incumbent is not providing competitively priced policies, or if the level of risk management and claim services are not comparable to the services provided by competing agents and brokers, a company may consider changing their trusted agent or broker. In addition, the review should document that no blocking or reserving of insurance companies is occurring. Once an organization selects their broker, all insurance companies should become available to the broker to complete their marketing efforts.  
         
Insurance and ethical business practices must go hand-in-hand. A general insurance review is a good way to verify and compare insurance coverage and costs, and evaluate agent and broker practices and services. Ethics is doing the right thing for the right reasons, always safeguarding clients’ assets.

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