Transcript Presentation: NAHU Ethics In Business

NAHU
Ethics In Business
Good Ethics is Good Business
Why?
 Maybe it’s because the insurance industry is so
highly regulated.
 Maybe it’s because NAHU makes a point to
promote ethical behavior.
 Maybe it’s because the insurance industry
realizes that ethical practices make good sense!
Whatever the reason, “Insurance and Financial
Services” should be highly credible!
The Good News
Employee perception of workplace ethics rank
industries as follows (from best to worst):
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
Insurance
Financial Services
Business Services
Wholesale Trade
Technology
Health Services
Communication
Manufacturing
Retail Trade
Transportation
2001 Walker Information National
Employee Benchmark Study on
Ranking the Best to the Worst
Marc Drizin, vice president and loyalty
specialist from Walker Information,
attributes the rating for insurance and
financial services to two factors:
1. “Both of these industries are regulated
and have compliance requirements.”
2. “The success in these industries is
dependent upon a company’s ability to
build a good reputation in the
marketplace.”
The Bad News
Statistics show that one out
of every five employees in
the insurance industry is
aware of at least one ethical
violation over the last two
years. We still have a long
way to go!
What Kind of Ethical Violations?
When insurance and financial services
employees were asked to: “Describe
the behavior you suspect is or was in
violation,”
 half reported witnessing unfair treatment
of employees
 four in 10 reported improper/personal use
of company resources
 25% reported lying or intentionally
misleading customers
Any Other Ethical Violations?
 Half reported lying on reports or falsifying
records
 Half reported lying to their supervisors
 Four in 10 reported conflicts of interest
How Can We Raise The Bar?
Walker Information Vice President
Jeff Marr suggests, “Integrity is
clearly a top-down value. If senior
leaders don’t exhibit the behaviors
and decisions of high integrity, the
company’s employees aren’t going to
go the extra mile to do the right
thing.”
True or False?
• Leadership is critical if you want to build
an ethical organization (not just CEOs and
board members).
• Ethical leadership can come from any of
us.
• For a collective industry to make
significant strides ethically, each employee
has to commit to doing what is right.
• We must do it because it is the right thing
to do.
• Our actions speak louder than words.
Why Ethics?
Consider this scenario: You are at a movie, which
have just ended. As the person in front of you
gets up, you see him drop a twenty-dollar bill
from his coat on to the floor. What would you do?
 take the money and run?
 say nothing and leave it for the cleaning crew?
 tap the person on the shoulder and let him know
he dropped some money?
Would your answer be different if it was a
five-dollar bill? How about a quarter?
The Moment of Truth
• You can’t put off this decision till
tomorrow.
• The person who dropped the money is
about to leave and be gone forever.
• There is not enough time to use a
“lifeline.”
• You can’t call a friend or poll the audience.
• The decision is completely up to you!
Whatever action you take or don’t
take is a direct reflection of your
character!
What is Character?
• It is defined as the combined moral or
ethical structure of a particular person.
Character is also defined as the combined
principles, values and beliefs of an
individual.
• Some children were asked during a
tutoring program, “What is character?”
One little boy stood up and said, “It is the
stuff inside you” – a simple, but accurate
answer?
Character in Your Professional Life?
• “Professional ethics” is defined as
the set of principles or values we use
to guide us professionally.
• “Ethics” is defined as a principle of
right or good conduct; a system of
moral principles or values; the rules
or standards governing the conduct
of the members of a profession.
Why Are Ethics Important to Our
Industry?
• Ethics provide guidance when we are
confronted with a new or unfamiliar
situation.
• Ethical behavior is critical in maintaining
trust between an insurance or financial
services professional and the clients he or
she serves.
• A “Code of Ethics” provides guidance
beyond just doing what is a legal or
regulated practice.
A Review of Prohibited Practices
• Rebating – Splitting a commission or
paying a client for his business. Prohibited
except in Florida and California and
punishable by loss of license.
• Twisting – Convincing a prospect to let a
policy lapse or to surrender a policy so
that a competitive company can sell him a
new policy that is not in the best interest
of the prospect.
Prohibited Practices
• Churning – Convincing a prospect to replace a
policy with a new policy from the same company,
which is not in the best interest of the prospect.
• Misrepresentation – When during an insurance
transaction an agent unintentionally makes
statements or presents misleading or false
information to the prospect. To avoid
misrepresentation, an agent must thoroughly
understand the product or service he or she is
selling. Many states require the delivery of a
“Buyer’s Guide” to protect the prospect.
More Prohibited Practices
• Fraud – Intentionally misrepresenting any
information in an insurance transaction.
Punishable by fines and/or imprisonment.
• Failure to Remit Premiums – It is
unacceptable for an agent to hold a
premium for an unreasonable length of
time. Premiums should be submitted to
the insurance company at the earliest
opportunity.
Looking for Guiding Principles
• Some say, “If it’s legal, it’s ethical.”
• Building long-term relationships means
going well beyond what is legal.
• You have to do what is “right” for the
client.
Your sense of right and wrong
probably came from your family. It is
from our families that we, hopefully,
learned the basic rules for building
relationships and getting along with
people.
Searching for Principles That Support
Long-Lasting Relationships
The first step is to look back at the Twelve Great
Character Lessons of Youth:
1. Cheaters never win
2. Do the best you can
3. Forgive and forget
4. Be thankful for what you have
5. Sisters are people too (so are brothers)
6. Always tell the truth
7. Be sure to say “please” and “thank you”
8. Don’t forget to clean up after yourself
9. What goes around comes around
10. To give is to receive
11. If you don’t have something nice to say, then don’t say
anything at all
12. Treat other people the way you would like to be treated
Translating Personal Character
Lessons Into Business Principles
The second step is to translate our list
of personal character lessons into a list
of business principles. Translations:
1. Cheaters never win – Don’t deceive or
mislead to get ahead.
2. Do the best you can – Always do what
is in the client’s best interest.
3. Forgive and forget – Don’t let anger or
frustration influence your future
actions.
Translations (Continued)
4. Be thankful for what you have –
Clients come first; prospects come
second.
5. Sisters are people too – Clients, coworkers and competitors deserve to
be treated with dignity and respect.
6. Always tell the truth – Always tell the
truth.
7. Be sure to say “please” and “thank you”
– Conduct yourself in a professional
manner.
Translations (Continued)
8. Don’t forget to clean up after yourself –
If you make a mistake, go back and
fix it.
9. What goes around comes around – Your
professional success and reputation
are the result of the way you
conduct your business.
10.To give is to receive – If you provide a
valuable service, you will be
rewarded.
Translations (Continued)
11.If you don’t have something nice to say,
then don’t say anything at all – Before
you speak, think about being
considerate and respect your client’s
confidentiality.
12.Treat other people the way you would
like to be treated – Clients, co-workers
and competitors deserve to be
treated with respect, dignity and
compassion, just as you want to be
treated.
Case Study #1
• An agent is working on a large life case with an
older couple. All of the preliminary meetings with
the clients have gone well, and the agent has
scheduled a meeting to complete and sign the
application. During this meeting, the clients say
that they would like to have their son review the
proposal. The agent fears that this sort of thirdparty involvement could cause the clients to
become confused and possibly delay the whole
process. The agent convinces the clients to sign
the application. He then submits the case to
underwriting with the understanding that he will
send the proposal to the clients’ son for his
review…
Case Study #1 (Continued)
• The agent does send the information to
the clients’ son, though not right away.
Unfortunately, when the clients’ son calls
the agent to discuss the proposal, the
agent is unavailable and a little slow in
getting back to him. By the time the agent
and son finally discuss the proposal, it is
too late to make any changes because the
policy has already been issued.
• How should the agent have handled this
situation? Here are two suggestions.
Case Study #1 (Continued)
• Suggestion 1: When the clients bring up their
desire to have their son review the proposal, the
agent should STOP the application process
immediately and schedule an appointment with
the clients and their son. Preferably, the agent
should set the appointment before the end of this
meeting. Keep in mind that the son
represents another prospective relationship
to develop. If the proposal the agent has
presented is in the clients’ best interest and he or
she openly shared their thoughts and expertise
with the son, they will have created the
foundation for a new relationship.
Case Study #1 (Continued)
• Suggestion 2: The agent can avoid this situation
by asking one simple question early in the
relationship with the prospective clients: Are
there any other advisors you would like to
have involved in this decision-making
process? This question demonstrates a
commitment to the clients’ best interest as well
as a willingness to be a partner with the clients’
“circle of advisors.” Remember, the agent’s
success is dependant upon his/her ability to build
great business relationships; consequently an
agent should always be looking for opportunities
to meet and serve new people. Always do what
is in the clients’ best interest.
Case Study #2
• Agents “A” and “B” are both independent agents working in
the group health market. Agent A has found him/herself in
a competitive situation with Agent B three times over the
last six months. In each case, when Agent A has met with
the prospective clients, it becomes apparent that Agent B
has misrepresented the features and benefits of the plans
offered by the XYZ Insurance Company. Agent A knows this
because he/she also represents XYZ Insurance Company
and is familiar with its plans.
• In two of the three cases, the clients have enrolled with
Agent B with what Agent A believes is an unrealistic view of
the plan’s benefits. This is very frustrating for Agent A
because not only has he/she lost the business, but also
he/she believes that Agent B has misled the clients.
• What should Agent A do?
Case Study #2 (Continued)
• The appropriate action is not as clear as it may
seem. If we keep our focus on building
relationships, however, here are some
possibilities.
• First let’s consider the prospective client. Even
though Agent A is not the “writing agent,” that
doesn’t mean they can’t offer information.
Remember, if they provide value, they will
be rewarded. Agent A could present the client
with marketing materials from XYZ Insurance and
highlight the commonly misunderstood features
or benefits. This information would be valuable to
the benefits administrator.
Case Study #2 (Continued)
• Second, Agent A could also make their
selves available as a resource for future
questions or issues. Both of these actions
would demonstrate the agent’s
commitment to the client’s best interest
and develop the agent’s relationship with
the prospective client, thus positioning
Agent A for next year’s renewal.
• Next let’s consider Agent A’s possible
actions with respect to XYZ Insurance and
Agent B.
Case Study #2 (Continued)
If Agent A assumes that XYZ and Agent B share
thier desire to serve the client’s best interest, and
if Agent A is committed to maintaining the
integrity of industry he/she works in, here are a
few possible actions.
• First, Agent A could contact the local sales
representative for XYZ and suggest that
additional training may be needed for Agent B
with regard to the company’s plan designs. This
action demonstrates that Agent A values his/her
relationship with XYZ and is committed to help
the company maintain its reputation in the field.
Case Study #2 (Continued)
• Second, to raise the level of commitment
to professionalism in the industry, Agent A
could send Agent B information regarding
the professional development
opportunities provided by local, state or
national trade associations (like NAHU).
• By inviting Agent B to participate in these
activities, Agent A is helping to create a
healthy and competitive environment
committed to serving the client’s best
interest.
Case Study #3
• Life and health agent John Q. Salesman receives
a phone call from Bob K., an employee of ABC
Corporation. John has worked with ABC
Corporation as its group health agent for several
years, and occasionally the benefits administrator
has referred employees directly to him for
assistance. Bob (the employee) asks a few
questions regarding COBRA and, during the
course of the conversation, he discloses, in
confidence, that he is considering resigning from
his current job. A few days later John (the agent)
gets a call from the benefit administrator about a
rumor in the office that Bob was thinking about
quitting. The benefit administrator wanted to
know if John knew anything about it.
Case Study #3 (Continued)
Question:
What should John do?
Case Study #3 (Continued)
• As life and health insurance agents, we are
trusted and confidential advisors. We have a
responsibility to the clients we serve to keep their
best interest in mind and to hold sensitive
information in confidence.
• This is even more critical in light of HIPAA privacy
regulations regarding patient privacy.
• While this information regarding Bob’s future
employment may not be considered protected
health information, John still has a responsibility
to keep information disclosed to him confidential.
Case Study #3 (Continued)
• It would be appropriate to make the following
statement to the benefits administrator: “As a life
and health agent, I have an obligation to
maintain client confidentiality and take that
responsibility very seriously. This responsibility
extends to all the people with whom I consult,
including the employees of my corporate clients.
My professional reputation is dependent on my
ability to develop the trust and confidence of the
people I serve, and I hope you can appreciate my
commitment to the principle of confidentiality.”
Case Study #3 (Continued)
• This statement works to develop the
relationship with the benefits
administrator by emphasizing John’s
commitment to conduct himself in a
professional manner while
maintaining the confidence that Bob
has placed with him. Remember: “If
you don’t have something nice to
say, then don’t say anything at
all.”
Other Ethical Issues for Insurance
Professionals
Conflicts of Interest
• As an agent in the insurance and financial
services industry, an agent will have to identify
and disclose any conflicts of interest.
• A conflict of interest can best be described as a
situation where an agent gets into a position
where they are representing or advising clients
who have opposing needs, goals or interests.
• To best serve the clients an agent must
represent, they need to identify and
disclose, as soon as possible, any conflict of
interest they discover.
Examples of a Conflict of Interest
1. An agent serves on a board or
committee, for a friend’s company,
that has the authority to make
purchasing decisions for the
products they sell. The accountant
recommends key man insurance.
You are a decision-maker and
represent a life insurance company
that could fill this need. Conflict of
Interest!
Examples of a Conflict of Interest
2.
The agent feels pressured to get a client’s case
underwritten. The client indicates that he wants
to move to another carrier because of increased
costs. The owner says if costs don’t come,
down he’ll discontinue the insurance. In
reviewing the applications the agent suspects
medical information has not been disclosed.
The agent is caught between an obligation to
provide accurate information to the carrier and
the client’s desire to reduce cost. Conflict of
Interest!
Examples of a Conflict of Interest
3. An agent feels pressure to sell a product
even if it is not in the client’s best
interest because your agency is looking
for a big bonus from XYZ Company. To
get that bonus, a certain number of
cases have to be placed with XYZ
Company. XYZ’s product does not meet
the needs of the client but the agent is
encouraged to sell it anyway. Conflict of
Interest!
Resolving Conflicts of Interest
• First, recognize that the conflict
exists.
• Second, disclose the conflict to the
people involved.
• Finally, search for a solution that
does not compromise an agent’s
professional integrity.
Corporate Governance
• For the purpose of our discussion, a corporation is any
entity created by an individual or group of individuals for
the purpose of engaging in or developing the insurance
industry. Within our industry there are many different types
and sizes of corporations.
• In all cases, large or small, it’s people who lead and govern
these corporations – people whom we (the consumers,
employees, agents, vendors and stockholders) count on to
provide us with direction and ethical standards.
• While issues, objectives and opportunities are different
from one corporation to another, there are two common
goals that all corporate leaders should consider to ensure
ethical practices.
Corporate Governance (Continued)
Goal/Challenge 1: Balancing the
Needs of All Stakeholders
• All corporations serve the needs of
multiple stakeholders, defined as any
individual or group of individuals who
interact with and benefit from the
activities of a particular corporation.
Corporate Governance (Continued)
Common stakeholders include:
Stockholders
Employees
Representatives
Customers
Vendors
Neighboring communities
Corporate Governance (Continued)
The common element for all stakeholder groups
is that, in each and every case, the stakeholder is
in a mutually beneficial relationship with the
corporation:
 Stockholders provide capital in exchange for
profits.
 Employees provide labor in exchange for
compensation.
 Customers provide payment in exchange for
products and services.
 Vendors provide products and services in
exchange for payment.
 Communities provide public services in exchange
for economic development.
Corporate Governance (Continued)
• A corporate leader interested in building
an ethical business must keep each of
these stakeholders’ interests in mind at all
times. Impossible?
• Keep in mind that these relationships are
“mutually beneficial.” That is to say,
benefits to one group of stakeholders
should, by design, be benefits to all of the
other stakeholder groups as well.
Corporate Governance & Ethics
Invariably, ethics and integrity come
into play when corporate leaders
take actions and set policies that
exploit one stakeholder group for the
benefit of another.
For example:
Corporate Governance & Ethics
(Continued)
 Using inferior materials in an effort to cut
costs and boost profits for the benefit of
stockholders without regard to the needs
of the customer.
 Offering excessive bonuses and stockoption plans to employees without regard
to the impact on stockholder return on
investment.
 Damaging or polluting the local
community’s environment in an effort to
maintain current price levels for customers
on the other side of the world.
Corporate Governance & Ethics
(Continued)
Goal/Challenge 2: Balancing Long-Term and
Short-Term Objectives
• Actually this is an extension of the first challenge, “to
balance the needs of all stakeholders,” because it is the
long- and short-term needs of each stakeholder group that
come into question.
• The ethical breach usually occurs when the pressures
associated with meeting short-term demands cause
corporate leaders to take actions or set policies that
undermine the company’s or stakeholders’ long-term
objectives.
• A classical example of this indiscretion is “cooking the
books” in order to achieve a quarterly profit or influence a
lender when cash is tight.
Corporate Governance & Ethics
(Continued)
• A corporate leader’s resolve and integrity is
critical in these situations!
• To govern effectively, corporate leaders must
give careful consideration to long- and short-term
objectives, avoiding the temptation to do what is
less confrontational or convenient, always
standing firm for what they believe is right.
• Clearly corporate leaders set the tone for the
ethical behavior within the companies they
govern.
• This responsibility is critical to the company’s
success, especially in the insurance and financial
services industry, where trust and confidence are
the cornerstones for long-term success.
Health Care Morality vs. the FreeMarket System
• Striking a balance between providing access to
quality health care and managing the day-to-day
concerns of a company in a competitive
marketplace may be the most difficult issue for
the insurance professional.
• On one hand, consumers have asked the
insurance carriers to keep the cost down. One of
the ways to accomplish this goal is to establish
contractual relationships with providers and
encourage patients to use the specified health
care providers in exchange for a discount on
services provided.
Health Care Morality vs. the FreeMarket System (Continued)
• BUT when a person is involved in a medical
emergency, the idea of delaying care solely for
economic reasons doesn’t make sense.
• Consequently, the insurance professional finds
himself stuck in the middle of a conflict between
health care moralities and the demands of the
free-market system.
• We spoke earlier about the responsibility of
balancing the needs of all stakeholder groups.
• In this case the health care and financial needs of
a customer are juxtaposed with the insurance
company’s desire to provide a competitively
priced product with a good return on investment
for its stockholders.
Looking for the Answers About
Conflict
A five-step process for recognizing,
managing and resolving conflict:
1. Recognition – The first step in resolving
conflict is to recognize its presence.
Conflict resolution involves
acknowledging that there is conflict and
then making a commitment to resolve it.
2. Disclosure – Once recognized, all
parties must be aware of it and
understand it thoroughly, which creates
the positive environment necessary for
finding solutions.
The Five-Step Process in Conflict
Resolution (Continued)
3. Solution – Corporate leaders are
responsible for searching out creative
solutions and then building a consensus
among the parties involved on the best
course of action.
4. Communication – Once the parties
have identified a solution and a course of
action, effective communication and
training are the keys to the successful
implementation of any change.
The Five-Step Process in Conflict
Resolution (Continued)
5. Feedback – Since it is difficult to
anticipate all of the potential effects of a
change in policy, procedure or value
system, corporate leaders should seek
feedback from all parties involved in the
original conflict. Careful attention must
be paid to ensure that everyone is
making progress.
The Five-Step Process in Conflict
Resolution (Continued)
• While the responsibility of managing the
inherent conflict between health care
morality and the free-market system falls
on corporate leaders, all insurance
professionals have an obligation to
contribute to this process.
• Through the collective efforts of all
insurance professionals, effective solutions
can be designed and implemented.
Social Responsibility
• As life and health insurance agents, we
possess information and expertise
(VALUE) the average person does not
possess.
• We are the trusted advisors when it comes
to insurance and financial matters.
Consequently, we have an individual
and collective responsibility to always
look out for our clients’ best interests,
share our good fortune, and offer our
expertise within the communities we
work.
Three Suggestions for Social
Responsibility
1. Education – Our education should be
one of our primary responsibilities.
• We possess information the average
prospect/client needs and typically does
not understand.
• Unfamiliarity with everything from
terminology and operating procedures to
their rights and responsibilities can be
very intimidating and frustrating for
consumers.
Efforts in Social Responsibility
(Continued)
Consider several opportunities to relieve
this prospect/client stress through:
• One-on-one meetings with benefit
administrators or owners
• One-on-one conversations with a client’s
employees, your neighbor or colleague
• Writing a newsletter for prospects and
clients
Efforts in Social Responsibility
(Continued)
• Accepting an invitation to speak at a local
church, service club, Rotary, public or civic
organization
• Putting on a seminar for the local chamber
of commerce
If we consider education one of our
primary responsibilities, opportunities
to educate and share our expertise
appear all around.
Efforts in Social Responsibility
(Continued)
2. Sharing your time, talent and treasure –
Consider this:
As agents who benefits from the work of trade
associations like NAHU and other industry
groups, it is in our best interest to support their
efforts with our time, talent and treasure.
 Join NAHU
 Volunteer to serve on a committee
 Become an advocate for the development
and preservation of our industry
 Get involved!
Efforts in Social Responsibility
(Continued)
3. Be a Humble Expert – As the result of
our ongoing training and daily activity,
insurance agents become the providers
of important advice to our clients. While
our efforts to educate clients and the
general public certainly help to create
informed consumers, we will always
have more expertise than the average
person has; consequently, they will view
us as an advisor.
Efforts in Social Responsibility
(Continued)
• In order to be socially responsible, the
agent must accept this responsibility. This
means we must maintain a constant
eye on the client’s best interests and
never use our expertise as a source of
power to manipulate a client for
personal benefit. As we continue to
develop knowledge and expertise, we also
take on the additional responsibility of
conducting our business with integrity
expected of a trusted advisor.
Efforts in Social Responsibility
(Continued)
• Beyond our professional obligation, being
socially responsible also provides the
opportunity to bring meaning to the work
we do. Selling products and making a
commission is on the first level of success.
Making a difference in the lives of the
people we serve and for the
communities in which we work and
live is what makes the complete
insurance professional.
Privacy
HIPAA
• As life and health insurance agents, we are
exposed to and trusted with personal medical
information from the clients we work with. It has
always been good business practice to view this
type of information as confidential. In 1996,
however, the federal government passed the
Health Insurance Portability and Accountability
Act (HIPAA), which provides specific rules for how
we must protect personal medical information. It
is no longer an option.
Privacy (Continued)
Who is required to comply with HIPAA?
1. Covered Entities – A Covered
Entity includes health plans, health
care clearing houses and most
health care providers. (Includes
employer group health plans)
Privacy (Continued)
2. Business Associates – A Business
Associate includes a business or an
individual who works with a Covered
Entity and creates, uses, receives or
discloses protected health information.
3. Employer and Other Sponsors of
Group Health Plans – Includes all
employers that receive protected health
information as well as other
organizations that sponsor group health
plans, e.g., a union plan.
Privacy (Continued)
Protected Health Information
• HIPAA defines as any individually
identifiable health information that is
created or received by a health care
provider, health plan, employer or
health care clearinghouse. (PHI
includes a person’s name and
address.)
Privacy (Continued)
HIPAA requires that a group health
plan does not disclose this
information except for the following
permitted or required disclosures:
To the individual.
To carry out treatment, payment or
health care operations.
With a valid authorization.
Permitted Disclosures (Continued)
 Under limited circumstances, when the
individual has the opportunity to agree or
object to the use or disclosure.
 For defined “public good function” and for
very limited “marketing” purposes.
 Disclosure of protected health information
to business associates, with satisfactory
assurance that the business associate will
adequately safeguard the information.
Privacy (Continued)
Required Disclosures
 To individuals seeking to access their
protected information.
 To individuals seeking an accounting of
disclosures of their protected health
information.
 When required by the secretary of HHS to
investigate or determine the health plan’s
compliance with the regulation.
Privacy (Continued)
Business Associates – As life and
health agents, we fall under the
definition of a “Business Associate,”
consequently, we are required to
enter into a “BA” contract with the
health plans with which we work.
These contracts are required to have
the following provisions:
Business Associate Contract Provisions
• Establish the permitted uses and
disclosures of protected health
information.
• Provide that the business associate will
not use or further disclose the information
other than as allowed under the contract
or required by law.
• Provide that the business associate will
use appropriate safeguards to prevent the
unauthorized disclosure of information.
Business Associate Contract Provisions
(Continued)
• Require the business associate to report to
the health plan any unauthorized uses or
disclosures of the information.
• Ensure that any agents or subcontractors
to whom the business associate discloses
protected health information agrees to
these same restrictions.
• Provide that the business associate will
make protected health information
available for inspection.
Business Associate Contract Provisions
(Continued)
• Provide that the business associate
will make protected health
information available to amend and
that the business associate has the
capacity to make amendments.
• Provide that business associates can
provide for an accounting all of their
disclosures of protected health
information.
Business Associate Contract Provisions
(Continued)
• Require that the business associate agrees
to make its internal practices, books and
records available to the secretary of HHS
for inspection, if necessary.
• Provide that the business associate agrees
to return or destroy, if feasible, all
information and limit future uses and
disclosures to those purposes that make
its return or destruction infeasible.
• Authorize the termination of the contract if
the business associate has violated a
material term of the contract.
Privacy (Continued)
GLBA (Gramm-Leach-Bliley Act of
1999) – This law put into place privacy
requirements for the protection of
consumers’ non-public, personal financial
information. It is specifically designed for
and directed at professionals working
within the financial services industry. Your
first step in determining the impact of
GLBA on your business is to determine if
you receive information that is protected
by the law.
GLBA (Continued)
1.
2.
3.
4.
5.
The types of information that GLBA
protects:
Information from an individual seeking
to obtain an insurance product
Information that is financial in nature
Information that relates to a personal,
family or household product or service
Information that is non-public
Information that identifies the individual
GLBA (Continued)
• Each state’s government has the job of
enforcing the GLBA requirements within
the insurance industry.
• While efforts have been made to promote
consistency from state to state, the reality
is that each state’s compliance measures
can be different. It is our responsibility
to familiarize ourselves with the
compliance measures for each state
in which we do business.
F.Y.I.
• The information presented in both the
HIPAA & GLBA sections of this
presentation are not intended to be
complete descriptions of these regulations.
• In the context of this ethics course, the
intent of this discussion on HIPAA & GLBA
was to present an overview of this
important legislation.
• As insurance professionals, it is our
responsibility to conduct our business in
accordance with state and federal laws.
Ethics – A Three-Questions Test
When you find yourself in a situation where
there is more than one possible course
of action and you are having trouble
deciding which action would produce the
most ethical result, consider these
questions:
1. Is the action legal? If there is any
question as to the legality of a potential
act, we need to seek legal counsel.
Ethics – A Three-Questions Test
(Continued)
2. Would I want an account of my
actions published in the local
newspaper? If the thought of a public
review of an agent’s actions creates any
reservations or concern, the action they
are considering is probably not the best
solution. They should continue to search
for better alternatives – alternatives
he/she would be proud to share with
thier family, friends and community.
Ethics – A Three-Questions Test
(Continued)
3. Does this action support my
commitment to building long-term
relationships? If the action an agent is
considering creates a win/win situation
for everyone involved, then he/she can
move forward. If there’s a chance that
their action will damage a relationship,
they should reconsider thier position and
look for better alternatives.
Remember, for this discussion, “action” includes
both the actions we take AND the actions we
don’t take. A lack of action can be damaging,
and to do nothing is still a choice you make.
Putting It All Together
• Behind our titles, business objectives and
professional identities, we are just people,
your clients are just people, and people
are just people.
• If you want to build great business
relationships, start with the great
character lessons of our youth, the basic
principles for getting along with others.
• Translate these lessons into business
principles and then use them to guide
your actions in the business world.
Where Do We Go From Here?
If an agent is interested in building or developing
his/her business relationships:
1. An agent can surround his/herself with people
who understand and live by these relationshipbuilding principles.
2. Take on the task of teaching these relationshipbuilding principles.
3. Start practicing them today! The only way to
move these concepts and ideas, on ethics from
information an agent know about to information
they live by is through practice, trial and error.
Review
NAHU’s Code of Ethics:
• To hold the selling, service and administration of
health insurance and related products and
services as a professional and public trust and
do all in my power to maintain its prestige.
• To keep paramount the needs of those whom I
serve.
• To respect my clients' trust in me, and to never
do anything that would betray their trust or
confidence.
• To give all service possible when service is
needed.
NAHU’s Code of Ethics (Continued)
• To present policies factually and accurately,
providing all information necessary for the
issuance of sound insurance coverage to the
public I serve.
• To use no advertising that I know may be false or
misleading.
• To consider the sale, service and administration
of health insurance and related products and
services as a career, to know and abide by the
laws of any jurisdiction, federal and state, in
which I practice, and seek constantly to increase
my knowledge and improve my ability to meet
the needs of my clients.
NAHU Code of Ethics (Continued)
• To be fair and just to my competitors, and
to engage in no practices that may reflect
unfavorably on myself or my industry.
• To treat prospects, clients and companies
fairly by submitting applications that
reveal all available information pertinent
to underwriting a policy.
• To extend honest and professional conduct
to my clients, associates, fellow agents
and brokers, and the company or
companies whose products I represent.
Thank You
This presentation was made possible
through the adaptation of an online
presentation prepared by
insurancestudy.com.
The full presentation and test can be
found on www.nahu.org.