Academic journal article Journal of Risk and Insurance

Code of Professional Ethics of the American Institute for CPCU

Academic journal article Journal of Risk and Insurance

Code of Professional Ethics of the American Institute for CPCU

Article excerpt

Code of Professional Ethics of the American Institute for CPCU, sixth edition, ed. Eric A. Weining, 1999, Malvern, Pa., American Institute for CPCU.

This text aims to achieve two primary purposes. First, it serves as part of the required study material related to the CPCU professional designation. Second, it is intended for CPCUs as a useful reference on the code of ethics by which they are bound. An additional hope is that the book will provide information and inspiration to others with an interest in business ethics. The text successfully builds on five decades of thought specifically related to the CPCU designation and the formal Code of Ethics that was introduced in 1976.

A Commentary on the Canons, Rules, and Guidelines forms the heart of the text. The Commentary provides readers with textbook-like material that is written in an easyto-read, conversational manner to supplement the bare Code. The nine Canons of the Code are general standards of an aspirational and inspirational nature-lofty goals reflecting the fundamental spirit of altruism. For each Canon, the text introduces and discusses issues that are likely to be faced by insurance professionals. Each of the Canons is followed by one or more related Rules. Unlike the Canons, the Rules are specific mandatory and enforceable standards. Guidelines follow the Rules and assist CPCUs and CPCU candidates in interpreting the various Code provisions, understanding their rationale, and applying them to frequently encountered situations that require ethical judgment. The text includes hypothetical case studies and examples of advisory opinions to illustrate how the Code would be applied.

As a medium for conveying the Code's Canons, Rules, and Guidelines, I found this book to be very accessible and informative. Thus, with regard to the book's two primary purposes, the text provides a good source on ethical insurance issues to which the CPCU can turn. The book's strength is that it succinctly conveys the essentials of ethical dimensions of being a CPCU without invoking Venn diagrams or abstract concepts such as utilitarianism, positive versus negative duty, trust, or virtue. Rather, the book gets right to the business of ethical decision making and ethical behavior.

The Code does not rest on the contention that unethical behavior is costly and thus should be avoided. Rather, the foundation of the CPCU Code of Ethics is altruismthe doctrine that the general welfare of society is the proper goal of an individual's actions. The first of nine Canons states: "CPCUs should endeavor at all times to place the public interest above their own." An important discussion in a related Guideline (Guideline 1.2) describes the difficulties that often arise when CPCUs simultaneously serve two or more masters-their immediate supervisors, insurers, stockholders, policyholders, agents, industry associations, etc. The remaining Canons, Rules, and Guidelines include discussions of continuing professional development, legal conduct, performance, maintaining and raising professional standards, professional relationships, public education, integrity of the CPCU designation, and integrity of the Code.

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