20.2 The CPCU Code of Professional Conduct & the Nine Canons
Key Takeaways
The CPCU Code of Professional Conduct, introduced in 1976, consists of Canons, Rules, Guidelines, and Disciplinary Rules, Procedures, and Penalties.
The Canons are aspirational goals; the Rules under each Canon are mandatory, enforceable minimum standards, and a Canon violation alone is not grounds for discipline.
The nine Canons are: Put People First, Keep Learning, Be Fair and Honest, Enhance Risk Management and Insurance, Elevate Professionalism, Maintain Ethical Relationships, Educate the Public, Uphold the Designation, and Maintain the Integrity of the Code.
Canon 8's Rules and Guidelines restrict use of the CPCU designation and key, bar overstating what the designation shows, and bar implying you represent The Institutes.
Canon 9's Rules bar supporting unethical candidates, require revealing unprivileged information about alleged violations on request, prohibit retaliation, and require reporting unauthorized use of the designation.
The CPCU Code of Professional Conduct & the Nine Canons
Quick Answer: The CPCU Code of Professional Conduct binds CPCU applicants, candidates, and designees. It has nine Canons, which are aspirational goals, and each Canon is followed by Rules, which are mandatory minimum standards. Only a Rule violation can lead to discipline. The Code also includes Guidelines for using the designation and Disciplinary Rules, Procedures, and Penalties. The Code was introduced in 1976.
Structure of the Code
| Component | Nature | Enforceable? |
|---|---|---|
| Canons | Broad goals and principles of professional conduct | No, not by themselves |
| Rules | Specific minimum standards under each Canon | Yes; violations can lead to sanctions |
| Guidelines | Detailed standards incorporated into Canon 8's Rules on use of the designation and key | Yes, through Rule R8.1 |
| Advisory Opinions | Interpretations issued by the Board of Ethical Inquiry | Published opinions guide everyone bound by the Code |
| Disciplinary Rules, Procedures, and Penalties | How complaints are investigated and sanctions imposed | Governs enforcement |
The booklet explains that, in the absence of a Rule violation, violating a Canon is not sufficient grounds for disciplinary action.
The Nine Canons and Their Rules
Canon 1: Put People First
Insurance professionals should endeavor to place the public interest above their own.
- R1.1: Avoid even the appearance of impropriety. The duty to put the public interest above personal gain applies to every CPCU, whether or not the job involves direct contact with consumers. Serving insurance purchasers well also means treating all claimants, including third-party liability claimants, promptly and fairly.
Canon 2: Keep Learning
Insurance professionals should seek continually to maintain and improve their professional knowledge, skills, and competence.
- R2.1: Ongoing professional education is a minimum obligation. A CPCU must maintain a high level of expertise in the fields served. The Code does not set a fixed number of continuing education hours.
Canon 3: Be Fair and Honest
Insurance professionals should obey all laws and regulations, and should avoid any conduct or activity that would cause unjust harm to others.
- R3.1: Use the utmost good faith. Do not restrict fair competition, except through a legally enforceable noncompete or similar lawful arrangement. Do not willfully misrepresent, conceal, or fail to furnish material facts.
- R3.2: Do not let financial gain or personal benefit interfere with sound professional judgment.
- R3.3: Stay informed of and obey the laws and regulations governing professional activities in the country where business is conducted, and do not commit any felony.
Canon 4: Enhance Risk Management and Insurance
Insurance professionals should be diligent in the performance of their occupational duties and should continually strive to improve the functioning of the insurance mechanism.
- R4.1: Competently and consistently discharge occupational duties.
- R4.2: Support efforts to improve insurance operations in ways that benefit the public and the efficiency of the insurance mechanism.
Canon 5: Elevate Professionalism
Insurance professionals should aspire to raise the professional and ethical standards of the insurance and risk management profession.
- R5.1: Encourage and help others enhance their professional competence.
- R5.2: Support the development, improvement, and enforcement of laws and codes that foster competence and ethical conduct.
- R5.3: Do not withhold information or assistance officially requested by regulators investigating or prosecuting alleged violations.
Canon 6: Maintain Ethical Relationships
Insurance professionals should strive to establish and maintain dignified and honorable relationships with those whom they serve, with fellow insurance professionals, and with members of other professions.
- R6.1: Keep confidential all information obtained in professional duties, unless required by law or necessary to complete the work.
- R6.2: Know the legal limits of the profession. Unless admitted to the bar or otherwise legally qualified, do not engage, or appear to engage, in the unauthorized practice of law.
- R6.3: Accurately represent your ability to provide the services required, and seek counsel from other professionals when issues fall outside your expertise.
Canon 7: Educate the Public
Insurance professionals should assist in improving the public understanding of insurance and risk management.
- R7.1: Support efforts to give the public objective information about its risk management and insurance needs and the products and services available, and keep abreast of developments that affect the insuring public.
Canon 8: Uphold the Designation
CPCUs should honor the integrity of the CPCU designation and respect the limitations placed on its use.
- R8.1: Use the designation and the CPCU key only as The Institutes' Guidelines allow.
- R8.2: Do not attribute to mere possession of the designation more knowledge or capability than completing the program demonstrates.
- R8.3: Do not make unfair comparisons between a person who holds the CPCU and one who does not.
- R8.4: Do not write, speak, or act in a way that leads others to believe you officially represent The Institutes unless authorized.
Canon 9: Maintain the Integrity of the Code
CPCUs should assist in maintaining the integrity of the CPCU Code of Professional Conduct.
- R9.1: Do not initiate or support the CPCU candidacy of anyone you know engages in business practices that violate the Code.
- R9.2: If you possess unprivileged information about an alleged Code violation, reveal it upon request to the authority The Institutes empowers to investigate.
- R9.3: Do not retaliate against anyone who reports, in good faith, a suspected violation of law, regulation, or the Code.
- R9.4: Report promptly to The Institutes any use of the CPCU designation by an unauthorized person.
Guidelines for Using the Designation (Canon 8)
- The designation or the initials "CPCU" may follow the holder's name on business cards, stationery, office advertising, signed articles, and professional listings.
- The CPCU key may appear, actual size or reduced but not enlarged, only on business cards and stationery used exclusively by CPCUs.
- The designation, initials, and key may not be used as part of a firm name, trademark, or logo, or affixed to products, except by The Institutes.
- Advisory opinions extend these rules. They prohibit "CPCU" on license plates and in web or email addresses (except by The Institutes and the CPCU Society and its chapters), and they apply the same dignity rules to web pages.
- Announcements of conferment should use the news releases The Institutes provides. Congratulatory advertisements must not solicit business.
Worked Scenario: Applying the Rules
A CPCU claims manager is asked by a regulator investigating a vendor-kickback scheme for documents about the company's contractor referrals. A colleague urges her to "forget" certain emails.
- Rule R5.3 requires her not to withhold information officially requested by regulators.
- Rule R3.1 prohibits concealing material facts.
- If The Institutes' authorized investigators later ask about a CPCU colleague's involvement, Rule R9.2 requires her to reveal unprivileged information on request.
- If she is threatened for cooperating, Rule R9.3 prohibits CPCUs from retaliating against good-faith reporters.
Common Traps
- Counting eight Canons: The current Code has nine.
- Treating Canons as enforceable by themselves: Discipline rests on Rule violations.
- Assuming a CE-hour requirement: Canon 2 and R2.1 call for ongoing education, but the Code does not set a fixed number of hours.
A complaint alleges only that a CPCU fell short of Canon 5's goal of raising professional standards, without identifying any Rule violation. How does the Code treat this complaint?
The CPCU must be suspended until the complaint is resolved
Canons carry the same weight as Rules, so sanctions are automatic
The complaint must be referred to a state insurance commissioner
Without a Rule violation, a Canon violation alone is not sufficient grounds for disciplinary action
A CPCU wants to print a greatly enlarged CPCU key on the agency's storefront sign and add 'CPCU' to the agency's name. What does Canon 8 guidance say?
Neither is permitted; the key may not be enlarged, and the designation may not be part of a firm name or logo
Both uses are permitted if the CPCU owns the agency
Only the enlarged key is permitted
Only adding 'CPCU' to the firm name is permitted
Which Rule requires a CPCU, upon request, to reveal unprivileged information about an alleged Code violation to the authority The Institutes empowers to investigate?
R2.1
R6.1
R8.3
R9.2
Sections you finish are checked off in the contents.