Wall Street Journal in December

¶ … Wall Street Journal in December 2002 pointed out the fact that "after the Sept. 11 terror attacks, some of the first life-insurance payouts went not to the victims' families, but to their employers." This tendency seemed to be emphasized as security became the number one concern for the Americans and the fear of terrorist attacks became more pregnant. However, given the fact that life insurance was initially conceived to benefit the widows and children of the deceased so that they would be able to sustain themselves financially after his death, we may nowadays wonder whether there is the slightest sign of ethics left in the life insurance concept or whether it has all become a business.

Turning even life insurance into a business, is that something we can judge as being positive or negative?

There are several aspects to be discussed here, as some of them are mentioned in the article. From a business or economic point-of-view, this form of legal tax evasion seems an excellent way to improve one's business and pursue economic growth, in the entire national economy. Indeed, without pursuing a direct tax cut, you are shutting your eyes upon an insurance business that you know is not entirely correct, but it is legal. Companies can spend some of their revenues before taxation and, additionally, as part of the bonus, the insurance benefits are not subject to taxation. So, from a business perspective, everything seems to fit the ethical norms: profit maximization is the primary goal for any company.

However, we need to address this issue from the individual perspective, as well as from a larger perspective, according to moral and ethical norms and principles by which we should abide.

The first ethical question that arises is whether or not it is normally ethical to purchase life insurance policies without the knowledge of the person at hand, as most of the companies were reported to be doing for several years. The idea seems ridiculous, mainly because you are treated as a good without consenting to it. Similarly, you are forced to prostitute yourself, however, by some strange way, you do not know of it. Even if the comparison may be forced, it is practically the same thing: people materially benefit from an event related to your person without you having any knowledge of it.

Of course, it seems that companies have partly given up on the secrecy and are now informing their employees about the policy and obtaining their consent. It is no good if the process isn't entirely transparent and it seems it is not, because one can't really be sure that the sum declared by the company is real.

Even if the companies have legal backing and have declared that most of the benefits obtained from insurance policies will be used "to finance employee benefits" (Schultz and Francis, 2002), we are entitled to ask ourselves if this is truly so or whether the companies have discovered one of the numerous holes in the legislation that allow them to make profits unaccounted for and turn the law upside down so as to obtain profits that are not subject to taxation.