A while back, we discussed the strange case of the life insurance company that didn't seem to care whether or not an applicant was blatently committing fraud. I was notified this morning that the other agent has enticed the "client" to file an Agent of Record letter, thereby letting me off the hook.
To a point.
First, an AOR is a means by which one can specify that a particular agent be assigned exclusively to you. Often, one will see this in a group situation, where it helps to both "cut out" competition and also guarantee a certain amount of continuity on one's behalf. Less often, one will see this with life insurance, usually for service-related issues. I can't recall a time where I've either asked for (or been on the receiving end of) an AOR while a life insurance application was in process.
As to "letting me off the hook," well, it's true that I'm no longer faced with the potential problem of the policy actually being issued "on my watch." This relieves me of some major ethical dilemnas, not the least of which is "what will I do if this thing is ever actually issued?"
On the other hand, I know, and the other agent knows, and the carrier knows that there was fraud committed in the application process. If and/or when a claim is actually submitted on this policy, it will be interesting to see if the carrier actually pays it. In the (entirely likely) event that it contests the claim, I may well be in the rather dubious position of being a witness for both sides. In the event, I'm certainly glad that I sent a note to the underwriter reiterating the sequence of events and my concern about them.
There is no "happy ending" here: both the underwriter and the carrier have lost my respect. I don't know the other agent well, so there was no respect to lose, but I don't envy his position: he knows that I know, and he lobbied for the AOR, thus putting any future onus completely on himself.
The client, of course, is both a moron and a fraud.
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