12.07.2015, 9:15:00 AM

Interview with Self Insurance Institute of America on NC's captive ethics code

The North Carolina Captive Insurance Association is the first state-level captive insurance association to create an aspirational code of conduct.  I was recently interviewed for an article in the Self Insurance Institute of America's monthly magazine on the topic. 

The NC Captive Insurance Association is the only captive insurance trade group dedicated to representing the interest of captive owners and captive insurance professionals in the North Carolina domicile.

The Association’s board established an ethics subcommittee composed of members who represent a variety of professional interests (accounting, actuary, captive management, legal, and insurance). At the direction of the board, the subcommittee drafted (and the board approved) an aspirational Code of Ethics for the members of the Association. We believe that this is a first-in-the-nation ethical code for the industry. The code is composed of ten canons of conduct, along with an explanatory comment after each canon.

The list of professional associations which have adopted ethical codes is nearly endless (but includes engineering, medicine, the law, psychological counseling, financial planning, commercial insurance, and countless others). However, to our knowledge, no state association has set out to describe the contours of ethical conduct in the industry; including conflicts of interests, best practices, and what is considered acceptable conduct. This aspirational code is designed to raise awareness of ethical issues confronted by captive insurance professionals.

Most professionals engaged in the captive insurance industry will likely read the code and realize that, consciously or subconsciously, they were already conducting their business affairs in that same manner. They attend seminars, stay up to date on industry trends, are diligent in attending to client matters, act as ambassadors for the useful business purposes of captive insurance, and avoid breaking the law or advising clients to break the law. The canons of conduct are not designed to impose onerous new burdens on the industry; instead, they highlight best practices that have already been widely adopted.

Other state associations may copy this code of ethics, or choose to create other similar rules of guidance. Either way, additional energetic and intelligent professionals will be thinking about these issues and how the industry can best address them. This dialogue is necessary as the industry grows, matures, and gains increasing recognition as a useful and valid tool of risk financing.

Ultimately, this code should be the catalyst for conversation. Both conversations within an office setting when potential ethical conflicts arise, as well as an industry-wide conversation between stakeholders and domiciles. By having a written code with certain boundaries of conduct, captive insurance professionals will be better equipped to spot potential conflict areas. The mere creation of a written code raises awareness of the issues which captive insurance professionals face, while its content provides guidance in those areas.

Hopefully, the adoption by the North Carolina Captive Insurance Association of a formal Code of Ethics will initiate a broader discussion within the industry on the appropriate conduct, appropriate client service, and the ethical operation and utilization of captive insurance. 

You can find the entire article here.

Labels:

0 Comments:

Post a Comment

<< Home

back to top