Insurance agents ponder ethics as industry changes

* To whom does a life insurance agent owe his allegiance, the company he works for or his client?

* If an agent finds that another agent has committed what he considers a breach of professional ethics, what is his responsibility?

* Will the entrance of banks and brokerage houses into the insurance business place strains on the professional ethics of the industry?

These and other ethical questions concerning the insurance industry were part of a program this week at the annual meeting of the American Society of Chartered Life Underwriters, the professional association that relates to the financial planning part of insurance.

Dr. Clarence Walton, the Charles Lamont Post Distinguished Professor of Ethics at the American College, in Bryn Mawr, Pa., indicated that with many types of corporations entering the insurance business, the industry could expect ethical problems to become more widespread. And, if indiscretions occur, he pointed out, the entire industry will be tarnished.

Despite some interest in resolving ethical questions, chartered life underwriters (CLUs) who were present said ethical questions often took a back seat in their home states to insurance commissions. One agent complained that the Illinois Insurance Commission had never revoked a license for ethical questions. And an Indiana agent said industry pressure had caused a new governor to replace a tough insurance commissioner who had revoked some licenses for ethical violations.

Another from New York State noted, ''Agents have been fined or suspended in New York State for doing illegal things like cashing a client's dividend check, but I don't know of any fined or suspended for doing anything unethical.'' As Dr. Walton noted, however, ''Ethical questions involve judgments. And the issues raised can be ambiguous.''

For example, in a working session with the CLUs, Dr. Walton presented a hypothetical case of a company that set a policy to hire only experienced CLUs with exceptional track records. The company's chief executive officer told his salesmen specifically to become friends with possible recruits and to spend a year trying to woo them. Once they join, they would be signed to an exclusive contract so they could sell only their new company's products.

As the CLUs pointed out, this policy raised some ethical questions. For example, one asked, wasn't the company placing its interest before the clients'? Another felt it was ''exploitive'' of the friendship established between CLUs. Still another pointed out that the industry would never have any ''new blood'' if everyone hired only experienced CLUs. Still another agent added that the exclusivity contract might not be beneficial to the agent's clients.

But other agents disagreed, pointing out that the change might benefit clients after all. Those who disapproved of the company's policy, they pointed out, were presuming the client came out on the short end of the stick. And, finally, in an informal poll of the group, Dr. Walton found that about 60 percent of them had been wooed to new jobs by other companies.