Ethics in Insurance

Ashley Whisner

G. A. Lunde Agency Representative

Student of Business

Shippensburg University

Proofread by: Robert Myers & Greg Lunde

Executive Summary

Ethics in the insurance and financial industry is an enormous difficulty that organizations must learn to overcome. Even though these two industries are highly regulated it still leaves room for unethical activities to arise from inside and outside organizations. Each organization must create guidelines and procedures to help ensure that its organization is not engaging in unethical activities. The G. A. Lunde Agency is an excellent example for any organization to follow in order to prevent its organization to be affected from ethical activities.

The purpose of this paper is to analyze a State Farm Insurance Agent and how it deals with ethical issues that may arise from within and outside the company. State Farm is a multiline insurance company (Grauer, 2009). State Farm sells personal Property and Casualty Insurances, Commercial Property and Casualty Insurances and also provides Financial Services to individuals and organizations. In 2010 State Farm was ranked thirty fourth in the Fortune 500. According to The Fortune Global 500 State Farm is the world’s largest mutual Property and Casualty firm. (State Farm Insurance, 2011). According to William Cupach, lawsuits accusing insurance firms of participating in unethical insurance sales practices have increased over the past few years (Cupach & Carson, 2002). However, State Farm takes a firm position in the market place by providing individually owned agent offices in order to provide their customers with unparalleled customer service and to ensure that its customers are being provided the correct insurance and financial plans for them through a series of frequent assessments (What can my State Farm agent do for me? , 2010).

Being a leader in the insurance and financial services industry does not excuse a company from dealing with...