I recently wrote a continuing education course called “Finally, a FUN Ethics Class!” My goal is to get through the material without putting everyone to sleep. I’ve been fairly successful so far.
While doing a session for the New Orleans Association of Health Underwriters back in October, I introduced one of the topics by asking “who here has cats?” About a third of the hands went up. “And who uses the word ‘my’ when referring to their cats?” The same hands were raised. Of course, everyone knows that nobody really owns a cat—they pretty much do what they want.
“Who here has children?” I continued. This time more hands shot up. “And who uses the word ‘my’ when referring to their kids?” Again, the same hands. But we all know that you can’t own a person.
“Who has clients?” I finally asked. Everyone raised their hands. “And who uses the word ‘my’ when referring to their clients?” Every hand stayed in the air, even though most of our clients are temporary at best.
The word “my” implies ownership, or at least possession. We use it to describe things that belong to us, things that we—and nobody else—have a right to. Things like cats, kids and clients.
“So when is it ok to take away someone’s cats?” I asked. “When they’re mistreating them” was the obvious reply. Same answer for the kids. “So when is it ok to take away someone’s clients?” Any time you can get an agent of record letter, right? No, of course not. As with cats and children, there are times when it’s appropriate to take away another broker’s clients, and times when it’s not.
If we look at one end of the spectrum, there are certainly some situations when it makes sense for a broker to ask for an agent of record letter. When we stumble across a client who hasn’t spoken to their broker in years is one example. There are some brokers who sell a client initially and then never call them again, hoping that they’ll renew year after year. Brokers like that deserve to lose the business.
It’s also okay to take away another broker’s group when you present a good option that he didn’t even show the employer—perhaps the other agent failed to quote a particular carrier or chose not to present a consumer-directed option like an HRA or HSA when that strategy was clearly right for the group.
At the other end of the spectrum, there are times when it’s definitely inappropriate to ask for an AOR. Perhaps the other broker is a fellow member of NAHU, has a good reputation in the industry, made the exact same recommendation you would have made, and is doing a good job of servicing the group. When you can add no value for the client, there really isn’t a reason for them to swap brokers—in my opinion, it’s unethical not to walk away from the business in this situation.
Sometimes the current broker is doing everything right, but the client is blaming her for something that isn’t her fault. Instead of asking the client to sign a letter making you their agent, a more professional—and more ethical—thing to do would be to explain their broker is doing a great job and then do your best to clear up the confusion. Instead of stealing the case, you can help the other broker save it.
All of these examples are pretty clear-cut. But the reason this topic is appropriate for an ethics class is because not every situation is. An ethical dilemma arises when we have to make a decision not between right and wrong, but between two right answers.
Maybe another broker made an appropriate recommendation, but you can find the client a similar plan at a similar price with a different carrier. Situations like this require a judgment call. It’s not always clear and it’s not always easy, but we owe it to our clients to give them all the information and then let them make the decision.
Editor’s Note: After three years, Eric has decided to take a break from his monthly column. He will still contribute to Benefits Selling.
Continue Reading for Free
Register and gain access to:
- Breaking benefits news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical converage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
