39095349
Description
Flashcards by Sandy Oklen, updated 5 months ago
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Created by Sandy Oklen
5 months ago
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| Question | Answer |
| What is AGENCY? | a licensed corporation or partnership, or an individual sole proprietor agent, that meets the nominee requirements set out in the Council Rules. |
| What is CLIENT? | a person who may reasonably be expected to rely on a licensee’s advice or actions with regard to insurance. |
| What is LICENSEE? | a licensed insurance salesperson, agent, or adjuster. |
| What is PERSON? | includes a corporation, partnership, society, association, or other organization or legal entity. |
| What is PRINCIPAL? | a person on whose behalf a licensee has undertaken to perform adjusting services |
| What is TRANSACTION? | a situation in which a licensee provides an insurance product or service to any person |
| What are the 5 overlying principles of ethical practice for an advisor? | CODIC: Competence Objectivity Disclosure Integrity Confidentiality |
| Competence | Advisors must: • Conduct all insurance activities in a competent manner. They must apply their knowledge and skill in a manner consistent with the usual practice of the business of insurance in the circumstances; • Be diligent and financially reliable; meaning they can be relied upon to properly safeguard and account for money and property entrusted to them, and to promptly deliver them in accordance with the circumstances; • Be aware that conduct outside their professional life, such as outstanding judgments, pending legal proceedings, and bankruptcies, may reflect on their financial reliability; • Adhere to the continuing education requirements; • Follow the anti-money laundering procedures when completing insurance business; and • Refrain from giving advice in areas beyond their expertise as an insurance licensee. |
| Objectivity | Advisors must: • Be objective, honest and sincere when advising clients on services and products; • Complete an analysis of the client’s needs and the product’s suitability for their situation; • Act in a manner consistent with the client’s or principal’s best interests; • Remain faithful to their duties and obligations as an insurance licensee; • Provide a duty of good faith to insurers, insureds, fellow licensees, regulatory bodies, and the public. |
| Disclosure | Advisors must: ● Inform clients on all aspects of the insurance products they purchase, including any changes that occur during the terms of the policies; ● Ensure illustrations include prices, values and benefits clearly and fairly, with disclosure of amounts that are not guaranteed; ● Make full and fair disclosure of all material facts, to enable clients to make informed decisions regarding their insurance; ● Disclose any fees charged in addition to the policy premium. ● Use sales materials or illustrations that are clear and straightforward to avoid misleading or deceiving clients; ● Not use terms such as “guaranteed” without appropriate qualification or evidence to support the statement; ● Inform the client of arrangements to place the client’s insurance through another agent; ● Fully and accurately disclose any information material to the insurer’s decision to issue a contract of insurance; and ● Inform the insurer when placing insurance on behalf of another agent who is acting for the insured. |
| Integrity | Advisors must: • Be trustworthy and conduct all professional activities with reliability and honesty; o Behaviour outside the professional context can reflect on trustworthiness and call into question one’s suitability to hold an insurance licence. • Engage in fair competition so clients can access the products and services they need at reasonable prices; • Deal effectively with client concerns and objectives; and Never discriminate based on a client’s age, gender, marital status, ethnic origin, physical or mental ability, religion, sexual orientation or socioeconomic status. |
| Confidentiality | Advisors must: • Hold in strict confidence all information acquired in the course of the professional relationship concerning the personal and business affairs of a client; and • Never divulge or use such information other than for the purpose of a transaction or of a similar, subsequent transaction with the same client, unless expressly authorised, or as required by law. |
| Steps to Ethical Decision-Making? | 1. Identify the Issue 2. Gather the Facts 3. Determine the Options and Evaluate 4. Test Options 5. Choose the Best Option and Review |
| 5 approaches to evaluation and decision making | 1. Utilitarian Approach 2. Rights Approach 3. Fairness or Justice Approach 4. Common Good Approach 5. Virtue Approach. |
| The Three Test options? | 1. The Smell Test 2. The Front Page Test 3. The Mom Test |
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