Ethics: Personal Fundamentals

Page 7 of 9

Being Fair

Two-Fold Responsibility

To respect others is to treat each unique person with dignity and fairness. This is a two-fold responsibility in the professional circle. To say that one responsibility is more important than another would be impossible. There is a triangle of respect in which one has the opportunity "to treat with dignity and fairness" persons in the professional circle. There is you, the agent, your co-workers, and your clients. The dictionary says that respect means, "admiration felt toward a person or thing that has good qualities or achievements, politeness arising from this; attention, consideration. To treat everyone in the same way without being influenced by their importance."

Fairness is a fundamental issue involving any dealings an agent will have with a client.

Fairness is being free from bias, dishonesty, or injustice as in a fair decision or a fair judge. It is legitimately sought, pursued, done, given, etc., as in proper under the rules and a fair fight. It is similar to being unbiased, equitable, just, honest, impartial, unprejudiced, disinterested.

Requirements

Fairness is often used in general terms to describe the relative value of a particular deal. However, when applied to financial planning, it encumbers the agent with more specific requirements. Fairness requires impartiality, intellectual honesty, and disclosure of conflicts of interests. In essence, fairness implies a standard of dealing where you would "do unto others" and you would "have them do unto you."

Fairness encompasses an agent's entire relationship with his or her client. It affects how they treat their client as compared to other clients (or prospective clients). It affects the time and effort an agent puts forth in advising and serving the client. It affects the manner in which the agent communicates with the client.

Regardless of any sophisticated models used, each client is unique. Each client has specific problems, concerns, and needs. Although some issues may be common to many or most clients, this commonality does not necessarily justify a "cookie cutter" approach. As such, each client is entitled to the same level of respect and responsiveness as any other client. This does not mean that an agent does not have preferred clients. What it does mean is that the agent should not treat any client less favorably in quality of service, than he or she would treat any other client.

Fair and Reasonable Manner

The cornerstones in the issue of fairness are compensation, conflicts of interest, and disclosing fully what a client requires in a consistent and timely manner.

Professional producers perform services in a manner that is fair and reasonable to clients, principals, partners and employers, and he or she discloses conflict(s) of interest in providing such services.

Most professionals know that when they treat others in the same fashion that they would want to be treated, they will have longevity in their career and are duplicating the essential trait of highly regarded financial professionals. Fairness is doing unto others what you would have them do unto you. Pretty simple? Sounds like the good old Golden Rule. Well, it is.

The Golden Rule is a principle with broad application that involves one of the most sensitive areas of potential disconnect if not handled properly and professionally in advance and throughout the timeline of a financial advisory situation.

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Not only are policy forms, clauses, rules and court decisions constantly changing, but forms vary from company to company and state to state. This material is intended as a general guideline and might not apply to a specific situation. The authors, LunchTimeCE, Inc., CEfreedom, and InsuranceEthics101.com, and any organization for whom this course is administered will have neither liability nor responsibility to any person or entity with respect to any loss or damage alleged to be caused directly or indirectly as a result of information contained in this course.