You are an insurance adviser running your own insurance practice. You have two staff. As a result of the COVID19 pandemic you cannot generate new business and many of your existing clients are facing financial difficulties and cannot meet the monthly payments of their insurance premiums. You know that for some of your clients having the insurance is essential for their peace of mind, whilst for some others it may no longer be necessary.

Also, for your insurance practice to survive financially, it needs the ongoing commissions on all the insurance policies sold by your practice.

You ask your staff to review the clients and their insurance needs and they come across the following two cases.

In case 1 the client is aged 65 and has retired and has no debts or other financial obligations. He has more assets than liabilities and is comfortably off. Given his current age his current life insurance premium is $15,987. This premium generates for you $1,000 p.a. in commission.

In case 2, the couple are in their late 30s, and because of the COVID19 pandemic, they are on job keeper. They both work in the hospitality industry. They have very little assets and liabilities and are currently renting. The life insurance premium is currently $1,200 each per annum. They have advised you they can no longer afford the premiums of $1,200 each. From the premiums you earn $200 per annum in commissions.

You are faced with an ethical dilemma in relation to the above two polices

REQUIRED

Discuss the various ethical and moral dilemmas you face in relation to the above two cases and what would be your answer? You need to consider who benefits from your answer, you or the client.

(10 Marks)