Ethical Standards for Insurance Agents
Sponsored by the Ohio Association of Health Underwriters
Doug Anderson
Direct: 614-365-2717
[email protected]
Holly W. Wallinger
Direct: 614-365-2716
[email protected]
What does “ethics” mean?
“The principles of conduct governing an
individual or a group”
www.merriam-webster.com
Why do we care about ethics?
Strong ethics can lead to ~
• Grow your business
• Maintain your insurance license
• Save the cost of defense!
Ohio law says,
“No person shall sell, solicit, or negotiate insurance in this
state unless the person is licensed for that line of authority
in accordance with this chapter.” Ohio Rev. Code 3905.02
What it means to you:
You must have a license to sell insurance – and you must
keep your license to continue to sell insurance.
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What can you do with your license?
The issuance of a license will qualify a person to sell, solicit
and negotiate insurance within the lines of business for
which the agent is licensed. ORC 3905.06
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The Department of Insurance is the regulatory agency
charged with supervision of insurers, insurance agents, and
insurance-related business.
The Superintendent of Insurance may suspend, revoke, or
refuse to issue or renew any license of an insurance agent
for certain ethical violations. Ohio Rev. Code 3905.14(B)
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Consumer Protection & Agent Discipline
The mission of the Department of Insurance is to provide
consumer protection.
The Superintendent oversees and enforces insurance
agent discipline as part of the consumer-protection mission.
Is the agent honest, trustworthy, knowledgeable and avoid
harming consumers?
This. Means. You.
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Ethical Standards for Agents
 The Legal Framework
Ohio Rev. Code 3905.14(B)(1) – (39) details the violations
for which an insurance license may be suspended or
revoked and for which civil penalties may be assessed.
39 potential violations =
Do not lie, cheat, steal or
Do not fail to alert the
Department if you did and
Do take responsibility
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License requirements
Apply, Renew, Inform
Application requirements: complete pre-licensing
education, pass exam, request criminal records
check, submit application form, pay fees
Renewal requirements: submit renewal application,
complete continuing education, pay fees
Inform Department of any changes: address,
criminal charges, court appearances
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License requirements, continued
When you apply, renew, and inform . . .
Be honest.
It’s really the best policy.
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Agent discipline
The process:
 Investigations of misconduct, as the result of a consumer
complaint, related to another agent’s discipline, or other
sources of information
 “Notice of Opportunity for Hearing”
 Hearings, recommendations, orders, and appeals
 Revocation, suspension, civil penalty, costs – or a finding
of no discipline
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Learn from the mistakes of others.
You can’t live long enough to make them all yourself.
Eleanor Roosevelt
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Review of ethical standards
Categories:
 “Don’t lie”: acts of misconduct, unfair/deceptive trade practices,
improper inducements
 “Don’t cheat”: accepting business from non-licensed person, using
dishonest/fraudulent practices, incompetence, failure to comply with
any insurance law, improper rebates or inducements
 “Don’t steal”: improperly withholding or converting money, failure to
pay taxes
 “Do alert”: Report any and all infractions to the Department directly
and in application and renewal applications
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WARNING:
The Department is watching.
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Learning from another’s mistake . . .
Disciplinary Actions Against Ohio Agents
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Agent Ethics: Notice and Hearing
Before denying, revoking, suspending, or refusing to issue
any license or imposing any penalty the superintendent
must provide the agent or applicant with notice and an
opportunity for hearing.
ORC 3905.14, ORC Ch. 119
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Mr. Russell H. Anderegg
 1990: FINRA licensed suspended for 2 years,
fined $84,000
 2012: Applied for insurance license
Answered “no” to question, Have you ever been involved in an
administrative action?
 2014: Applied for insurance license renewal
Answered “no” to question, Have you ever been involved in an
administrative action?
Did he answer correctly?
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)
Examining
the Ethical Standards
Providing incorrect or misleading information
• Providing incorrect, misleading, incomplete, or
materially untrue information in a license or
appointment application. ORC 3905.14(B)(1)
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Examining the Ethical Standards
Failure to report administrative actions
An insurance agent must notify ODI of any administrative action taken
in another jurisdiction or by another agency within 30 days.
Mere failure to report an action is not grounds for license suspension
or revocation but having a license in another state suspended or
revoked is grounds for suspension/revocation of an agent’s Ohio
license.
Note: the action does not need to relate to an insurance license.
Reporting is required if it relates to any professional, occupational or
financial license or licensing authority, e.g. FINRA action.
ORC 3905.22
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Russell Anderegg
The Department issued a Notice for Opportunity for Hearing
• Mr. Anderegg failed to appear
• Submitted undated “Letter of Explanation” in which he
admitted his failure to disclose but stated he thought the
violation was “too old and not relevant”
• Hearing Officer rejected explanation
Result?
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Civil penalty $750
Costs $250
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Ms. Angie Price
 Sold a life insurance policy with premium funded by
proceeds from an existing annuity
• Answered “no” on client’s behalf to question asking if any existing
annuity would be surrendered
• Did not provide notice requiring replacement of annuity
 Aided William Thurman – whose license was revoked in
2007 – with the direct sale of insurance product to
clients
Did she act appropriately?
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Aiding and Abetting
• Knowingly aiding and abetting another person or entity in the violation
of any insurance law of this state or the rules adopted under it.
ORC 3905.14(B)(39)
Replacement of life insurance and annuities
• Sets forth rules for the replacement of life policies or annuities,
including the requirement to provide a specific notice.
OAC 3901-6-05
Failing to comply with insurance law or rule
• Violating or failing to comply with insurance rule
ORC 3905.14(B)(2)
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Angie Price
The Department issued a Notice for Opportunity for Hearing
 Ms. Price failed to appear
 Submitted some written documentation to the
Department, including a statement that the Department’s
system is “flawed”
 Client was reimbursed $3,900 from Mr. Thurman to offset
$13,500 tax implications of partial surrender of annuity
Result?
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Angie Price
Licensed revoked
Barred from participation in the insurance industry or
regarding insurance in any manner
Costs $3,000
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Mr. Brady Aldinger
 2011 – 2013: Accepted premium payments from a
consumer and failed to timely forward them to insurers
 June 2013: Failed to return premium payment to
consumer upon nonrenewal of policy ~ did not provide
refund until investigation began
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Examining the Ethical Standards
Premium payments
Improperly withholding, misappropriating, or converting any
money or property received in the course of doing
insurance business, ORC 3905.14(B)(4)
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Examining the Ethical Standards(B))
Misappropriation
Improperly withholding or misappropriating any money/property
received in the course of doing insurance business.
-ORFailing to fulfill a refund obligation to a policyholder or applicant in a
timely manner.
• 30 days after policyholder, applicant or insurer takes action
• 30 days after insurer issues refund if agent is to issue portion of the
refund
• 45 days after date agent’s statement account showing refund
ORC3905.14(B) (4),(32)
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Brady Aldinger
 Department issued Notice of Opportunity for Hearing
 Appeared at hearing, with counsel
 Admitted to facts of untimely forwarding and return of
premium payments
 Described alcohol problem during that time, and
testified that he had voluntarily entered treatment at
Cleveland Clinic and is still active with AA
 Made restitution to clients
 First and only administrative action (licensed since1995)
Result?
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Civil penalty $1,500
Costs of $250
Took responsibility
Sought professional help for substance abuse
Ongoing participation in AA indicated that contributory
circumstances unlikely to occur again
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15 Minute Break
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Mr. James Blyth
 August 2012: Convicted of Public Indecency (misdemeanor)
 September 2012: Pled guilty to Forgery (felony)
 May 2013: Convicted of Forgery
 May 2013: Applied for renewal of license
Answered “no” to questions asking about any misdemeanor or felony
convictions
 October 2013: Convicted of Public Indecency
 June 2015: Applied for renewal of license
Answered “no” to questions asking about any misdemeanor or felony
convictions
 Did not report initial appearances before the court or final dispositions
within 30 days of occurrence.
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Examining the Ethical Standards(B))
Forgery
• Forging any document related to an insurance
transaction.
• Submitting or using a document that the agent knew or
should have known was forged.
• Being convicted of, or pleading guilty or no contest to, a
misdemeanor involving forgery.
ORC 3905.14(B)(7), (11) & (26)
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Examining the Ethical Standards
Misrepresentation on License Application
• Providing incorrect, misleading, incomplete or
materially untrue information on license or appointment
applications.
• Obtaining, maintaining or attempting to obtain or
maintain a license through misrepresentation or fraud.
ORC (3905.14(B)(1), (3)
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Examining the Ethical Standards
Criminal Convictions
Being convicted of or pleading guilty or no contest to a
felony.
Being convicted or pleaded guilty or no contest to a
misdemeanor involving the misuse of money or property,
fraud, forgery, dishonest acts, or breach of a fiduciary duty.
ORC 3905.14 (B) (6), (7)
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Examining the Ethical Standards
Failure to report criminal prosecutions
An agent must notify ODI of any criminal prosecution,
other than misdemeanor traffic, within thirty days. Note:
this reporting obligation applies when an agent has been
charged with a crime.
Within 30 days after the disposition of the criminal
prosecution, the agent must inform the superintendent of
the final disposition of the prosecution.
ORC 3905.22(B)
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James Blyth
Department issued Notice of Opportunity for Hearing
 Appeared at hearing
 Facts of forgery, public indecency, and alcohol abuse
 Did not admit to alcohol problem, but did admit to
“impulse control” problem
 Not receiving therapy for behavior control
 Hearing officer found preponderance of evidence for
criminal convictions and for failure to alert Department
Result?
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License revoked
Why?
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Mr. Michael Buchanan
 2014: Documents containing personal and/or privileged information –
including names, addresses, and SSNs of insureds – were found
discarded in an open and public Dumptser
 Files were not related to Mr. Buchanan’s clients but did relate to clients of
Mr. Buchanan’s prior business partner
 News media reported the discovery of the files to the Department
 Denied any knowledge of the files or how they ended up in Dumpster
 Denied knowing who could have placed them in the Dumpster
 Initially told Department investigators that he was not present at the time
the files were placed in the Dumpster
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Client Confidentiality
Loss of Control of Personal Information
All insurers and agents are required to report any Loss of
Control of policyholder information to ODI within 15 days
of discovery of such Loss of Control, if the Loss involves
more than 250 residents of Ohio.
“Personal Information” is an individual’s first and last name
in combination with a SSN, driver’s license number or
bank/credit/debit card account number.
Bulletin 2009-12
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Demonstrating incompetence
Using fraudulent, coercive, or dishonest practices, or demonstrating
incompetence, untrustworthiness, or financial irresponsibility, in the
conduct of business in this state or elsewhere
Ohio Rev. Code 3905.14(B)(9)
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Michael Buchanan
Department issued Notice of Opportunity for Hearing
 Appeared at Hearing, with counsel
 Facts related to prior business relationship, including
other agent’s conviction of tax fraud
 Had to vacate office due to unpaid rent and utilities
 Files placed in Dumpster were other agent’s files, but Mr.
Buchanan did have control over them
 Changed his story with Department investigators
 Dumpster open but public access difficult
Result?
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Civil penalty $1,500
Costs $500
Why?
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“Special factors” may be considered when denying a
license, imposing suspensions, revocations, fines, or other
penalties, and issuing orders. Ohio Rev. Code 3905.14(E)
 Did the agent act in good faith or make restitution?
 What was the degree of vulnerability of the person harmed?
 Was the agent subject to prior administrative actions?
 How many people were adversely affected?
 Did the agent voluntarily report violation or obstruct the investigation?
 If there was a criminal conviction, what was the nature of the
offense?
 And any other factor the Superintendent deems appropriate.
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Michael Buchanan
Hearing Officer’s consideration of the “special factors”:
 Conflicting statements and attempt to deflect
responsibility
 Responsible and trustworthy agent before this incident
(or no information to the contrary)
 No information from files used against any insured
 Not his files, but belonged to the other agent
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But wait, there’s more!
Michael Buchanan appealed the Department’s order to the
Franklin County Common Pleas Court.
“Any party adversely affected by any order of an agency issued
pursuant to any other adjudication may appeal to the court of common
pleas of Franklin county” O.R.C. 119.12
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Appeal of Department Order
The Court may reverse, vacate, or modify the Order to the extent
it is not supported by reliable, probative, and substantial
evidence or if it is not in accordance with law. ORC 119.12
 Reviews the record
 Assesses evidence and witness testimony
 Must defer to the agency’s findings
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Appeal of the Department’s Order
Court’s review of the Department’s findings that:
 Mr. Buchanan did not “disclose” personal privileged
information because the files were placed in a hard-toaccess Dumpster ~ there was no “intention” to disclose
 Mr. Buchanan demonstrated incompetence in allowing
sensitive information to be subject to the possibility of
disclosure, even if unlikely or unintentional
What did the Court decide?
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Appeal of Department’s Order
The Court reversed the Department as not supported by
reliable, probative, and substantial evidence because the
Department’s two statements were contradictory.
But were they contradictory?
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Mr. Glen Buttacavoli
 2015: Convicted of Falsification (misdemeanor)
 Withheld material information in application for Medicaid for a client
Failed to disclose a prior transfer of assets that he had handled for the client
He knew that the transfer would disqualify the client from Medicaid
 Only after discovery, repaid $8,600 to Ohio Department of Jobs and Family
Services
 Failed to report initial appearance and final disposition to the Department
 Failed to report pending disciplinary action before the Ohio Supreme Court
 Previously entered into Consent Agreement with Department after failure
to disclose Department of Commerce’s denial of securities license
Agreed to revocation of annuities license
Result?
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Demonstrating incompetence
Using fraudulent, coercive, or dishonest practices, or demonstrating
incompetence, untrustworthiness, or financial irresponsibility, in the
conduct of business in this state or elsewhere ~ 3905.14(B)(9)
Failure to report criminal prosecutions
An agent must notify ODI of any criminal prosecution within 30 days of
being charged with a crime and within 30 days of disposition of the
prosecution ~ 3905.22
Any other factors
Special factors to be considered, such as any factors the
Superintendent deems appropriate ~ 3905.14(E)
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Glen Buttacavoli
License revoked
Factors:
 Intentionally withheld information from ODJFS
 Would not have confessed if not caught
 History of questionable business practices toward
vulnerable senior clients
 Demonstrated consistent disregard of disclosure duties
 These factors outweighed mitigation evidence presented
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Mr. Angelo Babbaro
 2012: Appointment with Insurance Company terminated for cause
Provided false information on policy applications from 1999 through mid-2011
Almost 25% of annuity applications contained inaccurate birthdates
Resulted in $19,000 in overpayment of commissions
Commission was repaid, beginning prior to Department’s investigation
 Claimed “innocent mistake” due to new computer system
 Hearing Officer questioned his credibility about mistakes
 First complaint in over 20 years in insurance business
 On the board of organ and tissue donation organization
 Other community involvement
Result?
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Misrepresentation
Intentionally misrepresenting the terms, benefits, value, cost, or
effective dates of any actual or proposed insurance contract or
application for insurance ~ 3905.14(B)(5)
Dishonest practices
Using fraudulent, coercive, or dishonest practices, or demonstrating
incompetence, untrustworthiness, or financial irresponsibility, in the
conduct of business ~ 3905.14(B)(9)
Special factors ~ 3905.14(E)
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Civil penalty $5,000
Costs $250
Agree?
Disagree?
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Trisha Devine
 2011: Involved in hit-skip accident while driving under the
influence and texting while driving
 Injured a person
 Turned herself in, pled guilty, 3 years of probation
 Released after 1 year
 2015: Submitted online application for insurance license
 Disclosed felony convictions
Application approved?
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Superintendent may refuse to issue license:
Felony conviction
Having been convicted of or pleaded guilty or no contest to a felony regardless
of whether a judgment of conviction has been entered by the court ~
3905.14(B)(6)
Comply with insurance laws and rules
Violating or failing to comply with any insurance law, rule, subpoena, consent
agreement, or order of the superintendent or of the insurance authority of
another state ~ 3905.14(B)(2)
Good reputation
The applicant is of good reputation and character, is honest and trustworthy,
and is otherwise suitable to be licensed
~ 3905.06(A)(1)(h)
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Trisha Devine
Application approved
Turned herself in, demonstrating good behavior
Strictly complied with terms of probation, demonstrating striving
for redemption
Voluntarily disclosed felony convictions on application,
demonstrating honesty
Employer provided reference, demonstrating strong work ethic
and integrity
Claims she will never drink and drive or text while driving again
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Other Ethics Issues
 Failure to pay taxes: License may be
suspended to provide time to resolve
outstanding tax obligation
 Inform the Department in writing
when resolved
 Other professional license or regulatory
registration suspended or revoked
 Inform the Department before the
Department notifies you
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Rebates and Inducements
Rebate defined. A rebate occurs where the person
buying insurance receives some sort of compensation,
benefit, or kick-back from an insurer or agent to induce the
person to purchase insurance, when the compensation,
benefit, or kick-back is not stated in the insurance policy.
Inducement prohibited. Insurance agents must not pay
any rebate of premium payable on the policy, or any other
inducement not plainly specified in the insurance policy, as
inducements to insurance.
ORC 3933.01 (P&C); 3911.20 (life)
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Rebates and Inducements
Items worth less than $50
A promotional or advertising item or meal with a fair
market value of $50 or less is not valuable consideration
when the item or meal is given to induce an individual to
obtain a policy quote or general insurance information
and
the item or meal or other inducement is not tied to the
purchase of an insurance policy.
(ODI Bulletin 2009-13)
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15 Minute Break
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Duty to Report Ethical Lapses
An insurance agent or managing or general agent engages
in an unfair or deceptive practice when it knew or should
have known, of an agent’s misconduct related to the sale of
A & H insurance and:
(a) expressly ratifies or tolerates such conduct;
(b) and fails to report it to ODI; and
(c) fails to investigate upon the request of the
department.
Ohio Admin. Code 3901-5-12
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Requests for Information from ODI
Under her general authority to enforce the insurance laws,
the Superintendent may:
• Require any person to file a statement in writing
regarding any facts concerning the person's conduct
of the business of insurance.
• Administer oaths, compel (i.e. subpoena) witnesses to
testify; and
• Require the production of any book, paper, or
document.
ORC 3901.04
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Requests for Information from ODI))
Agents may be disciplined for:
• Failing to provide a written response to the ODI within
21 calendar days after receipt of any written inquiry
from the department.
• Failing to appear to answer questions before the
superintendent after being notified in writing by the
superintendent of a scheduled interview.
ORC 3905.14(B)(21), (22)
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Department Inquiries
Most common department inquiries to agents:
Consumer complaints
From Consumer Services Division
Agent Investigations
From Fraud & Enforcement Divisions
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Agent Inquiries & Investigations
 Don’t ignore the regulators ~ take them seriously.
 Be timely and communicate ~ extensions are often possible.
 What you say can and will be used against you.
 ODI can subpoena records, including bank records.
 You, the agent, may be the last person the investigators speak to – so they
will compare what you say with what they already know or think they know.
 Consider using legal counsel who knows insurance, the ODI, or
administrative law ~ at every investigative level
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Agent Ethics: Notice and Hearing
A person receiving a Notice of Opportunity for Hearing
must request a hearing with 30 days in writing to ODI or
the hearing will be waived.
If a hearing is waived, the Superintendent generally
issues an order imposing discipline.
Upon issuance of a Notice of Opportunity for Hearing,
the agent may submit a public records request to see
the investigative file.
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Agent Ethics: Notice and Hearing
At a hearing, ODI will present evidence and elicit sworn testimony
from witnesses and from the agent.
In response, the agent may contest the allegations and:
• Introduce documentary evidence
• Call witnesses
• Testify
• Produce letters of recommendation and/or character
witnesses
• Cross examine ODI witnesses
At a hearing, witness are sworn-in and must tell the truth under
penalty of perjury and a court reporter records all testimony.
Both parties have the ability to subpoena witnesses and
documents to be produced during the hearing.
There is no formal discovery process.
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Agent Ethics: Notice and Hearing
Following the hearing, the hearing officer issues a
recommendation and report.
The agent has 10 days to submit any objections to the
recommendation and report.
The Superintendent will consider the report and
recommendation, any objections, and issue a final order.
The Superintendent may accept the R&R, modify the
findings and propose penalty, or reject the R&R.
The Superintendent’s order can be appealed to the court of
common pleas.
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Agent Ethics: Notice and Hearing
Disciplinary Measures
Upon finding an agent violated an insurance law, the
Superintendent may do any of the following:
• Suspend, revoke or refuse to renew a license;
• Impose a civil penalty of $25K for each violation;
• Impose administrative costs incurred by ODI;
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Agent Ethics: Notice and Hearing
• Issue a cease and desist order;
• Prohibit the person from being employed in the
business of insurance in Ohio;
• Prohibit the person from having any financial interest in
any insurance agency, insurance company, bail bond
company or TPA.
• Order corrective action;
• Accept a surrender for cause for a minimum of five
years.
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Agent Ethics: Notice and Hearing
Mitigating Factors
The superintendent may consider the following factors in
imposing penalties or issuing orders:
1) Whether the person made restitution;
2) The actual harm or potential for harm to others;
3) The degree of trust placed in the agent by, and the
vulnerability of, people who were negatively
affected;
4) Any previous administrative actions;
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Agent Ethics: Notice and Hearing
Mitigating Factors cont.
5) The number of people negatively affected;
6) Whether the agent voluntarily reported the violation,
the extent of cooperation and acceptance of
responsibility;
7) Whether the agent obstructed or impeded the
investigation;
8) The agent’s efforts to conceal the misconduct;
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Agent Ethics: Notice and Hearing
Mitigating Factors cont.
9)
Remedial efforts to prevent future violations;
10) If the person was convicted of a crime, the nature of
the offense, whether the conviction was based on
acts under any professional license, whether the
offense involved the breach of a fiduciary duty, the
amount of time that has passed, and the person's
activities after the conviction;
11) Any other factors the superintendent determines to
be appropriate.
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V. Closing Exercise: Ethics Scenarios
What you can do to mitigate a bad situation:
• Self-report the situation to ODI before ODI learns of
the information from other sources.
• Cooperate with ODI fully as it investigates the matter
• Take full responsibility for your actions
• Satisfy all legal obligations including restitution
• Be honest with ODI and others
• Show that you have learned your lesson and that a
similar situation will not happen again
• Get professional colleagues and person friends to
submit recommendation letters
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Agent Ethics: Surrender of a License
An agent may surrender a license voluntarily at any time
except when under investigation.
ORC 3905.16
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Agent Ethics: Modifications of Prior Orders
An agent whose license was denied, suspended, revoked
or surrendered may submit a written application for
modification of the order. The superintendent will hold a
hearing to determine whether the previous order should be
modified, provided the following conditions are met:
• The order was issued more than 5 years ago;
• It has been at least 2 years since any previous
request; and
• The burden of proof is on the person requesting the
modification.
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John Wagner
 2007: Insurance license permanently revoked by Ohio for
failure to disclose a cease and desist order from
Massachusetts Department of Insurance
 2016: Submitted written request for modification of Ohio
order and attended hearing via speaker phone
 More than 5 years had elapsed
 No record of filing previous request in prior 2 years
 Established he was a person of good business repute – in insurance
industry for 40 years
 Met other requirements
Modification request granted
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Closing Exercise: Ethics Scenarios
Scenario #1: Signing another person’s name
Facts:
The insurer won’t accept a form you submitted
for the client because it does not include the
client’s signature.
To make things easy for your client and to avoid
delaying the issuance of the policy your client
needs, you sign their name and turn in the form.
Any problem with this action?
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Closing Exercise: Ethics Scenarios
Possible violations for signing another person’s name
• Forgery
• Dishonest practices under a license
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Closing Exercise: Ethics Scenarios
Scenario #2: Criminal charges are filed and then
dropped
Facts:
You recently sold a car. Shortly afterward, you
are charged with odometer tampering.
You call the prosecutor, who says he says he
made a mistake. The charges are dropped.
You do nothing else – are you off the hook?
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Closing Exercise: Ethics Scenarios
Possible violation for charges brought, then dropped
Failing to report criminal charges
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Closing Exercise: Ethics Scenarios
Scenario #3: Fees
As part of their sales practice, Bob and Bonnie Producer
tack on a fee as a percentage of the premium for each
policy to cover legitimate administrative costs they incur. If
the customer asks, Bob and Bonnie explain the fee.
Are these fees permissible under Ohio law?
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Agent fees:
An agent may charge a fee if the fee is:
 Disclosed to the consumer
 Not calculated as a percentage of the premium
 Not refunded, forgiven, waived, offset, or reduced by any commission
earned
 The customer consents
 Not as a part of application process for personal auto, homeowners,
individual life, individual sickness or accident insurance, disability
income, or credit insurance
ORC 3905.55
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Possible violation for charging fees:
Bob and Bonnie calculate their fees as a percentage of the
premium, and they don’t disclose the fee unless asked by
the client.
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Closing Exercises – Ethics scenarios
Scenario #4: Referral Fees
To thank your clients for referring their friends and
neighbors, you give them a $20 Starbucks gift card each
time someone they referred buys a policy from you.
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Closing Exercise: Ethics Scenarios
Possible violation for Starbucks card for referrals:
Improper referral fees. Referral fees or compensation
cannot be contingent on the purchase of insurance – in
the previous scenario, you only rewarded referrals for the
purchase of insurance.
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Scenario #5: Signing on behalf of client
You visit your elderly client at her home to discuss longterm care insurance. After some discussion, your client
applies for a policy. You fill out the application, as the
client provides answers to its questions. Then she signs
the application.
Later, you realize that you misspelled her name in two
places. You make the corrections and initial the changes
with the client’s initials.
Any problems here?
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Scenario #6: Providing a multi-line discount
A new client applies for an automobile policy and tells you
that he intends to buy homeowner’s insurance in the next
month. As a courtesy, you apply the multiple policy
discount that is available for such cross-line policies.
Later, you realize that the client never purchased the
homeowner’s policy, but the discount rate for auto is still in
effect. What should you do?
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Ethical Standards for Insurance Agents
Sponsored by the Ohio Association of Health Underwriters
Doug Anderson
Direct: 614-365-2717
[email protected]
Holly W. Wallinger
Direct: 614-365-2716
[email protected]