Key Takeaways
- West Virginia producers must act with honesty, integrity, and professionalism in all dealings
- The Golden Rule applies: Treat clients as you would want to be treated
- Fiduciary duty requires putting client interests ahead of personal interests
- Producers have duties of care, loyalty, disclosure, and confidentiality
- Ethical conduct builds long-term career success and avoids regulatory discipline
Last updated: January 2026
West Virginia Ethics & Professional Conduct
Core Ethical Principles
The Golden Rule in Insurance
Treat every client as you would want to be treated
This fundamental principle means:
| Application | What It Means |
|---|---|
| Coverage Recommendations | Recommend coverage you'd buy for your own family |
| Explanations | Explain terms as clearly as you'd want them explained to you |
| Claims Assistance | Handle claims as promptly as you'd expect for yourself |
| Disclosure | Tell clients everything you'd want to know |
| Honesty | Never deceive, even when it costs you a sale |
Fundamental Ethical Duties
| Principle | Application in Practice |
|---|---|
| Honesty | Truthful statements about coverage, costs, limitations |
| Integrity | Do the right thing even when no one is watching |
| Competence | Maintain current knowledge and skills |
| Loyalty | Put client interests before your own |
| Fairness | Treat all clients equitably regardless of premium size |
| Accountability | Take responsibility for your actions and mistakes |
| Confidentiality | Protect client information from unauthorized disclosure |
Fiduciary Duties
What Is a Fiduciary?
A fiduciary is someone entrusted to act in another's best interest. Insurance producers in West Virginia have fiduciary duties to their clients.
Core Fiduciary Obligations
| Duty | Description |
|---|---|
| Duty of Care | Exercise reasonable skill and diligence |
| Duty of Loyalty | Put client interests first |
| Duty of Disclosure | Reveal all material information |
| Duty of Confidentiality | Protect private information |
| Duty of Accounting | Properly handle client funds |
Duty of Care
Producers must exercise the skill and diligence that a reasonable professional would use:
| Requirement | Example |
|---|---|
| Competent Advice | Understand products you sell |
| Thorough Analysis | Assess client needs completely |
| Accurate Processing | Complete applications correctly |
| Timely Service | Process requests promptly |
| Continuing Education | Stay current on products and laws |
Duty of Loyalty
| Requirement | Application |
|---|---|
| Client First | Recommend what's best for client, not highest commission |
| No Self-Dealing | Don't benefit at client's expense |
| Conflict Disclosure | Reveal any conflicts of interest |
| Company Representation | Disclose which companies you represent |
Duty of Disclosure
Producers must disclose:
| What to Disclose | Why It Matters |
|---|---|
| Policy Terms | Client must understand coverage |
| Exclusions | Critical limitations on coverage |
| Costs | Premiums, fees, charges |
| Producer Status | Agent vs. broker relationship |
| Compensation | Upon client request |
| Material Facts | Anything affecting coverage decision |
Duty of Confidentiality
| Requirement | Details |
|---|---|
| Protect Information | Keep client data secure |
| Limit Access | Only share on need-to-know basis |
| Proper Disposal | Shred/destroy documents properly |
| Electronic Security | Protect digital information |
| Privacy Notices | Provide required privacy disclosures |
Putting Clients First
Client-Centered Approach
Step 1: Assess Needs Thoroughly
- Ask comprehensive questions about exposures
- Understand client's financial situation
- Identify all insurable risks
- Don't rush to make a sale
Step 2: Recommend Appropriate Coverage
- Match coverage to actual needs
- Recommend adequate limits
- Explain coverage options clearly
- Don't over-sell or under-sell
Step 3: Provide Full Disclosure
- Explain in plain language
- Highlight important exclusions
- Answer all questions honestly
- Document what was discussed
Step 4: Ongoing Service
- Review coverage periodically
- Update for life changes
- Assist with claims
- Be available when needed
Avoiding Conflicts of Interest
| Conflict | Proper Response |
|---|---|
| Higher Commission Product | Recommend best product for client regardless of commission |
| Sales Contests | Don't let contests drive recommendations |
| Quota Pressure | Client needs come before sales goals |
| Personal Relationships | Treat all clients professionally |
Professional Standards
Maintaining Competence
| Requirement | How to Comply |
|---|---|
| Pre-License Education | Complete 40 hours before exam |
| Continuing Education | 24 hours every 2 years |
| Ethics Training | 3 hours ethics required in CE |
| Product Knowledge | Understand products you sell |
| Regulatory Updates | Stay current on law changes |
When to Seek Help
A professional knows their limitations. Seek assistance when:
| Situation | Action |
|---|---|
| Complex Coverage Questions | Consult underwriter or specialist |
| Legal Issues | Refer to attorney |
| Ethical Dilemmas | Consult compliance officer |
| Specialized Risks | Refer to specialty producer |
| Claims Disputes | Involve claims department |
Documentation Best Practices
| Practice | Purpose |
|---|---|
| Written Recommendations | Document advice given |
| Signed Applications | Confirm client information |
| Declination Forms | Document when coverage declined |
| Meeting Notes | Record discussions |
| Email Trails | Maintain correspondence |
Building Trust and Reputation
Long-Term Success Through Ethics
| Benefit | Result |
|---|---|
| Client Retention | Satisfied clients renew and stay |
| Referrals | Happy clients refer friends and family |
| Reputation | Known as trustworthy professional |
| Career Longevity | Avoid discipline and legal problems |
| Personal Satisfaction | Pride in doing the right thing |
The Cost of Unethical Behavior
| Consequence | Impact |
|---|---|
| License Revocation | Career ended |
| Fines | Up to $10,000 per violation |
| Civil Liability | Lawsuits and judgments |
| Criminal Prosecution | Potential jail time |
| Reputation Damage | Career permanently harmed |
| E&O Claims | Insurance costs and claims |
Industry Ethics Standards
NAIFA Code of Ethics
The National Association of Insurance and Financial Advisors ethics code includes:
- Place client interests first
- Render continuous service
- Maintain high standards of competence
- Observe confidentiality
- Engage in fair competition
- Present accurate information
- Conduct business professionally
Ethical Decision-Making Framework
When facing an ethical dilemma, ask:
| Question | Purpose |
|---|---|
| Is it legal? | Compliance with law |
| Is it fair? | To all parties involved |
| How would it look? | If reported in newspaper |
| Would you be proud? | Of this decision |
| Does it feel right? | Trust your conscience |
Exam Tip: On ethics questions, always choose the answer that puts client interests first, provides full disclosure, and complies with regulations—even if it means losing a sale or earning less commission.
Test Your Knowledge
A West Virginia producer learns that a competing company offers better coverage at lower cost for their client. What should the producer do?
A
B
C
D
Test Your Knowledge
Which of the following is NOT a core fiduciary duty of a West Virginia insurance producer?
A
B
C
D