PHYSICAL PRIVACY - Coursework Example

For our current assignment though, I am going to take one ethical issue that was embedded into that business decision and discuss it in great detail. I will do my best to discover all of the facts that I will need in order to create an informed analysis of this particular ethical issue and make some suggestions pertaining to how the ethical issue may be dealt with by the insurance company prior to it actually becoming an ethical situation that the company has to handle. For this particular assignment, I have chosen to deal with the problem of Agent Honesty when it comes to their treatment of client policies and collection agreements.

In order to deal with this problem, the insurance company must first acknowledge the fact that the agents have a strong tendency to commit fraud once they have a non-exclusive partnership with the insurance company. Since they are basically freelancers, they do not answer directly to the company for any of their actions. If an insurance company uses too many independent agents, the possibility of being able to monitor all of their client based actions diminishes. Independent agents prefer having the more limited relationship that their status provides with the company as opposed to an exclusive agent who is bound by more company rules and regulations in terms of ethics.

That is why in the case of independent agents, the tendency of the insurance company is to have a narrow and specific view of the agent's business actions. The company will tend to not care too much about the actions of their independent agents without realizing that the unethical actions of the independent agents will have clear ramifications for their company as well in terms of protecting their clients against fraud. It is most likely that not all independent agents are aware of the fact that they are committing fraud in certain instances due to their lack of proper manpower training in terms of insurance sales services.

Therefore, it is important that the company reiterate the importance of honesty in all their business dealings in order to preserve the image of the company with future clients, and enhance their company image with their existing client base. Agents need to always be ethical and compliant of all government insurance standards. There is no gray area in this matter. Rogue insurance agents can cause the insurance company a sizable amount of fines and potential financial losses through fraud related lawsuits that the company will find itself facing.

Considering the lack of company based supervision of independent agents, it would seem more logical for insurance companies to deal with exclusive agents instead since they can have a more personal relationship with these agents whose actions and portfolios are open and easily accessible to the company. Thus making it easier to detect ethical violations at any given time. It is of the utmost importance that insurance companies be highly observant of their independent agent's patterns of behavior or financial transactions over a period of time.

This will help the company sniff out the potential abnormalities in the actions of the agent that could signify that the agent is involved in fraudulent actions against the company clients and the company itself. This can usually be determined by observing the agent's pattern of payment submission to the insurance com