Car Dealership-Gap Insurance-Ethics or License Jeopardy?

[rianna77]

Hello,
I need help. I sell Auto & Homeowners at a new start-up at Indy Broker in pennsylvania. We are 11 months in and growing.
Finanace has always sold Gap Insurance at a hefty mark-up.
But now that we are selling Auto Insurance there is a conflict of interest with the finance office.
My boss has put this directive out there below.

"We NEVER talk with customers about gap insurance. If they ask, we say “that will be discussed with you in the Finance office when you are completing the paperwork for your vehicle.”

Am I putting my license in jeopardy for failure to disclose all the options when I quote a policy ?
What if they don't ask ? Am I also obliagated by Pennsylvania State code to disclose it's availability by my carriers?
PS. The owner of the car dealership also owns the insurance company start up. It's a family affair.

The owner, manager and my boss are all adamant I don't talk about Gap Insurance at all.
I'm just as adamant that my duty is always to the consumer to review and disclose all options.
I feel like I can't do what they are asking me to do ethically and legally.
HELP please!

 

[VolAgent]

I admire your desire to look out for your customer's best interests. You will never go wrong with this as long as you don't cross any ethical, moral or legal lines. You also have an obligation to follow the directions of your boss.

Ultimately, I don't believe you are required to bring up GAP unless they ask. I question whether you can refuse to discuss it if they ask and the company has it available. My advice would be to call the DOI or an attorney, ask and then document the answer. If they feel you must disclose it, then either your boss needs to have that same opinion or you may need to go elsewhere.

 

[insurance1822]

Obviously your boss is being unethical b/c the dealership makes a good profit on their gap coverage. I imagine this will keep recurring and you'll be forced to just answer the question if they ask.

 

[bobson]

Hello,
I need help. I sell Auto & Homeowners at a new start-up at Indy Broker in pennsylvania. We are 11 months in and growing.
Finanace has always sold Gap Insurance at a hefty mark-up.
But now that we are selling Auto Insurance there is a conflict of interest with the finance office.
My boss has put this directive out there below.

"We NEVER talk with customers about gap insurance. If they ask, we say “that will be discussed with you in the Finance office when you are completing the paperwork for your vehicle.”

Am I putting my license in jeopardy for failure to disclose all the options when I quote a policy ?
What if they don't ask ? Am I also obliagated by Pennsylvania State code to disclose it's availability by my carriers?
PS. The owner of the car dealership also owns the insurance company start up. It's a family affair.

The owner, manager and my boss are all adamant I don't talk about Gap Insurance at all.
I'm just as adamant that my duty is always to the consumer to review and disclose all options.
I feel like I can't do what they are asking me to do ethically and legally.
HELP please!

Find out what the GAP plan covers from your finance department. Sometimes they include credit life and disability.

 

[INSUREGEEK]

Find out what the GAP plan covers from your finance department. Sometimes they include credit life and disability.

Yeah, there has to be a middle ground here.

I think you need to do some research on what exactly is being offered from finance and how it compares to what your carriers are offering. Compare pricing and other bundled benefits available from both sides.

It might be a hard convo, but you have to be well armed when you approach boss man about your fiduciary responsibility to your insurance client, and ask for a cut of the dealership commission when they make that next gap sale because it happened to be the right choice for the customer.

 

[djs]

I don't understand the problem. Just suggest they talk to the finance department about gap insurance.

If you start trying to sell gap insurance, you won't be selling insurance at that dealership. If your concern is you want the client to be covered, recommend they get it from the dealer. If your concern is not getting paid, be happy with what you are getting. If you are concerned about not covering all options, there is NO WAY you are anyway, there are just to many options to go over and not bore your clients to death.

There is NO requirement that you talk about every option with the client. In fact, in this case, you know they will be told about gap insurance, so there really is no requirement.

Dan

 

[SmartWorker]

Generally speaking, P&C agents are not fiduciaries assuming you're not licensed for some type of financial license. Once you cross over into securities, the game is completely different. Of course with anything in insurance, your state may have different rules on this subject.

As a straight up P&C agent, your legal responsibility lies in looking out for the insurance carrier's interests. Don't lie, cheat, or steal and you're going to be ok 99% of the time.

The fine line I see here is you can't misrepresent anything. If someone asks you if GAP insurance is available, you're not misrepresenting anything if you say "We handle that during the finance process here." I'd stick to my guns on that even with the tough customer because the worst that happens in that case is you don't make the sale.

On the other hand, you can't say it's not available when it is. You also want to avoid anything that's a comparison between the two options, as in "It is available but the one in finance is better."

Good luck!

----------

Generally speaking, P&C agents are not fiduciaries assuming you're not licensed for some type of financial license. Once you cross over into securities, the game is completely different. Of course with anything in insurance, your state may have different rules on this subject.

As a straight up P&C agent, your legal responsibility lies in looking out for the insurance carrier's interests. Don't lie, cheat, or steal and you're going to be ok 99% of the time.

The fine line I see here is you can't misrepresent anything. If someone asks you if GAP insurance is available, you're not misrepresenting anything if you say "We handle that during the finance process here." I'd stick to my guns on that even with the tough customer because the worst that happens in that case is you don't make the sale.

On the other hand, you can't say it's not available when it is. You also want to avoid anything that's a comparison between the two options, as in "It is available but the one in finance is better."

Good luck!