1. Introduction

1.1  Part of the role of the Chartered Institute of Loss Adjusters (hereinafter referred to as the “Institute”) is seen as providing, for its members, guidelines in relation to how they should behave in the provision of their services, and to set out the standards of professionalism that are expected of members. These are set out in this Guide to Professional Conduct (hereinafter referred to as the “Guide”) which is supplemental to the Institute’s Royal Charter and Bye-Laws (hereinafter referred to as the “Charter”).

1.2  One of the principal objectives of the Charter is to maintain high standards of professional practice and conduct by all members. Charter Article 2 (m) states that one of the objectives of the Institute is:

“To ensure that all members comply with the Institute’s Guide to Professional Conduct”.

1.3  Appropriate disciplinary measures to which members may be subject for breach of the Guide are set out in the Charter.

1.4  Throughout this document, the term “member” includes all classes of membership as detailed under Charter Article 5.

1.5  A member’s firm shall constitute a firm employing a member as a loss adjuster as detailed under Charter Article 1.

2. Ethics & Core Principles

2.1  A member shall act fairly and justly when acting on instructions from an insurer in relation to a policyholder’s claim under a policy issued by that insurer. Members should understand that they are trusted by Insurers to ensure that their Insurance promise is fairly and speedily delivered. Members should be objective in considering the facts in an impartial way to establish whether the Policy operates and to what extent.

2.2  A member should behave ethically and with integrity in all professional and business relationships. Integrity implies not merely honesty but fair dealing, truthfulness and acting responsibly at all times. When communicating with any party, a member should do so in a way that is accurate, straightforward and understandable by that party.

2.3  In addition to the duties owed to the public and to the member’s client or employer, a member is bound to observe high standards of conduct which may on occasion be contrary to their personal self interest. Members and their firms should anticipate and deal proactively with complaints.

2.4  A member should strive for objectivity in all professional and business judgements.

2.5  Members should conduct themselves with courtesy and consideration to all people with whom they come into contact and ensure that no disadvantage is occasioned on the basis of age, disability, gender reassignment, marriage/civil partnership, race, religious belief, sex or sexual orientation.

2.6  A member should take appropriate measures to ensure that those people with disabilities or special needs are not disadvantaged.

2.7  Members shall not provide hospitality or other benefits to clients or employees of client companies of a kind or scale or value which are inconsistent with the image of the profession. Members should be mindful that objectivity may be threatened or appear to be threatened by acceptance of goods, services or hospitality at an inappropriate level from a client or a policyholder (when they are the member’s client) or from an organisation seeking to offer services to the member. Where a member is acting on behalf of an insurer, they should not accept any inappropriate goods, services or hospitality from a policyholder.

2.8  If a member believes that any other member of the Institute may be in breach of the guide they should follow the complaints procedure of the Institute.

2.9  Members are equally responsible for reporting their own breach of the guide, as they are responsible for reporting another member. In the event of disciplinary hearings, the fact that a member has reported their own conduct will be taken into account.

2.10  It is a requirement of the Guide that members comply with the Charter.

3. Conflicts of Interest between Clients

3.1  Members should at all times be aware of the potential for conflicts of interest between clients. A conflict of interest between clients arises where a member, or a member’s firm, owes separate duties to act in the best interests of two or more clients in relation to the same or related matters, and those duties conflict or there is a significant risk that they may conflict.

3.2  Conflicts of interest encompass all situations where doing the best for one client will result in prejudice to another client in that matter or a related matter. A matter is related if it involves the same incident, asset or policy, or there is otherwise some reasonable degree of relationship.

3.3  Where a member is retained on behalf of one client in a matter, that member or their firm should not then act for a second client on the same or a related matter where the interests of the second client are adverse to those of the first unless the informed consent of both clients to the member or their firm so acting is obtained (but see also 3.8).

3.4  The informed consent of all clients should only be sought where this does not involve a breach of the duty of confidentiality owed to each client. Where informed consent cannot be obtained without breach of the duty of confidentiality, the member or their firm should first seek the informed consent of the client to disclosure of such confidential information to the other client(s) as is necessary to allow the informed consent of both clients to be obtained to their continuing to act. In most cases, it will only be necessary to disclose to the second client the name of the first client for whom the member or their firm is acting and the general nature of the matter.

3.5  If the informed consent of all clients to the member or their firm continuing to act cannot be obtained, the member or their firm may continue to act for one of the clients (or a group of clients between whom there is no conflict) provided that the duty of confidentiality owed to the other client(s) is not put at risk. Whilst the decision as to which client(s) the member or their firm continues to act for is for the member or their firm, where the member or their firm agrees to act for multiple clients in a matter, it is recommended that they should discuss and agree with the clients at the outset what will happen if a conflict arises and agree which client(s) the member or their firm will continue to represent where this is possible.

3.6  It is recognised that members do respond to claims on an emergency basis. If a potential or real conflict of interest arises at any point during the response and informed consent cannot be obtained, the member must take immediate steps to withdraw from the situation, whilst advising the claimant appropriately and with discretion as to the nature of the conflict.

3.7  Members and their firms should anticipate and deal proactively with conflicts of interest. Members or their firms should have in place a conflict management policy appropriate to their business model, and should have in place a process to identify the more probable conflicts that may arise.

3.8  The same Insured may have separate policies with different Insurers covering either different aspects of the same loss or where dual insurance exists, and historically for ease and economy of handling Insurers have been content for the same member to deal with both aspects of the loss. Provided the member acts impartially and transparently in such instances, nothing contained within these guidance notes is intended to impinge upon these agreed and established working arrangements.

3.9  It is not practical to establish guidelines that apply to all situations and circumstances. If a member is in any doubt as to the correct course of action, they should seek further advice and, if necessary, legal advice.

4. Confidentiality

4.1  A member acquiring or receiving confidential information in the course of their professional work should not disclose such information to third parties without the consent of the party to whom the information is confidential, unless there is a legal or professional right or duty to disclose.

4.2  The need to comply with the obligation of confidentiality continues even after the end of relationships between a member and a client or employer. As a result, it is important that members realise that a breach of confidentiality may arise not just in relation to two or more clients on a current matter, but could also result from a member’s, or their firm’s, relationship with a client on an historic assignment. In such circumstances, the duty of confidentiality owed to the former client may conflict with the duty to act in the best interests of the present client.

4.3  To avoid disclosure of confidential information, where appropriate, members or their firms should consider ensuring that employees enter into a confidentiality agreement and/or that further safeguards to confidentiality are put in place (such as the use of procedures to restrict access to confidential information). In this regard, use may be made of information barriers within a member’s firm, often referred to as “Chinese Walls”. An information barrier is in itself insufficient to address a conflict of interest. However, if properly constructed, an information barrier can be used to isolate confidential information, the dissemination of which may lead to a breach of the obligation of confidentiality owed to a client or former client.

4.4  Where there is a legal duty to disclose confidential information, it is incumbent on the member to disclose to the appropriate authority. Failure to so do may result in the member breaching the law and committing an unlawful act or default.

4.5  A member acquiring or receiving confidential information in the course of his or her professional work should neither use nor appear to use that information for his personal advantage or for the advantage of a third party. From time to time, members in dealing with commercial organisations will acquire confidential information in relation to that company’s shares or some other company’s shares. In such circumstances, the member must not deal in the shares of the company or cause or (so far as the member is able) allow any dealings to take place which might be regarded as “insider dealing”.

5. Beneficial Interests

5.1  Where a member or their firm obtains or receives any benefit by reason of their acting on a matter which has not been authorised by the client, the member or their firm is under a duty to account for such profit to the client or otherwise obtain the client’s informed consent to their retaining such profit.

5.2  A member’s own interests in relation to a matter or related matter may be direct (for example, a direct financial interest in the client) or indirect (for example, where a member’s relative holds a financial interest in the client) where those interests are relevant to the functions to be performed.

5.3  Specifically, where a member is working for an insurer, the member shall not handle an assignment if they:
i)  hold a material interest in the shares or other form of investment in the insurer from whom they receive instructions, and/or
ii)  hold a material interest in relation to the parties to whom the instructions refer unless the informed consent of the parties to their acting is first obtained.

5.4  Where a member is working for a policyholder, the member shall not handle an assignment if they hold a material interest in relation to the insurer of the policyholder unless the informed consent of the policyholder client to their acting is first obtained.

5.5  A conflict of interest also arises where a member’s duty to act in the best interests of any client in relation to a matter conflicts, or there is a significant risk that it may conflict, with the member’s own interest in relation to that or a related matter. Where such a conflict arises, a member should not accept instructions in the matter unless the client is first notified of the member’s interest and informed consent to the member’s acting in such circumstances is obtained.

5.6  Members should note that there may be circumstances in which, notwithstanding that consent to act has been or may be obtained, the member or their firm may wish to consider declining to act to avoid any potential professional embarrassment.

5.7  Members who own, operate, manage or administer supplier or contractor networks must act fairly and justly and with transparency to the policyholder when appointing such suppliers. Members should be influenced by the quality and suitability of the service provided, and the existence of any formal arrangement should be disclosed to any parties who may be involved in the claim.

6. Technical Expertise

6.1  A member should not accept or perform work if they are not competent to deal with it.

6.2  A member should carry out their professional work with due skill and care and with proper regard for the technical and professional standards expected of them.

6.3  All qualified members should comply with current Continuing Professional Development (hereinafter referred to as “CPD”) requirements. Such CPD activity is recommended to include those classes of claim and areas of insurance knowledge that is relevant to their work. Membership and participation in Special Interest Groups will assist in this regard.

6.4  All members should make efforts to read and understand relevant technical guidance notes issued by the Institute.

7. Compliance

7.1  A member who is regulated by the FCA or similar body should ensure they are not in breach of the rules and requirements of such regulation.

7.2  All members should be aware of and fulfil their obligations under the laws and regulations in force at the time. Current examples include data protection and money laundering.

8. Complaints

8.1  The Institute’s complaints handling procedure is available from the Institute’ Secretariat.

8.2  Where a member is employed by a firm, he should notify the firm immediately of any complaint received or intimated.

8.3  In undertaking the investigation of any complaint, the Institute may request from any member or at its discretion the member’s firm such information, explanation, documents and records as are reasonably necessary and available to enable it to perform its function in investigating such complaint, whether it be against the member or any other member. The member should assist in the provision of requested material within a period of 14 days or such period as agreed.

9. The Institute

9.1  No member may use or display the Institute’s crest or logo without the express permission of the Institute.

9.2  No member shall make any statement, representation or comment to the press or any other outside organisation either directly or implicitly as a spokesperson or representative of the Institute unless written authority is obtained from the Institute.

9.3  Members should seek to support and promote the Institute and its objectives.

9.4  Members behaviour reflects upon the reputation of the Institute and accordingly members should seek to comply with this Guide to Professional Conduct and avoid any action that may bring this Institute or fellow members into disrepute.

9.5  Members who hold office within the Institute or other professional organisations should not use such office in business advertising and promotions. The mention of such office, either current or historic, within a curriculum vitae is acceptable.

10th March 2014