Being released from an agency, questions about their "release form"

[Bogeyinvader]

I just started working an insurance, and the local agency i went had has had zero communication with me for two weeks. I recently met another local agency who offered way more. (Leads, CRM, VOIP, Medicare quoting and enrollment, agency support staff, etc) for free. They already loaded the CRM with leads, and the releasing agency just sent the paperwork over me to and this was added in it. The new agency sent it over to to their attorney's to be read because of this section they are concerned about.

can someone help explain what this means? and why the new agency is hesitant now?

Agent's Non-Solicitation Agreement. Agent acknowledges and agrees to the following:
For a period of twenty-four (24) months following the Effective Date, Agent agrees not to directly
or indirectly, for Agent or on behalf of another person or entity (including Accepting Agency and
its affiliates), (i) solicit any customers, agents, or brokers of Releasing Agency or its affiliates; (ii)
request, advise, or induce any person who is a customer, agent, broker, employee, contractor or
vendor of Releasing Agency or its affiliates to withdraw, curtail, or cancel, or engage in any other
activity that could adversely affect the relationship such person has with Releasing Agency or its
affiliates, which includes a prohibition on inducing or attempting to induce any of the Carriers'
policyholders or insurance product holders from whom Releasing Agency receives a commission
override to discontinue payment of premiums or cancel, surrender, relinquish, replace, or otherwise
cause termination of any policy or other insurance product with the Carriers; or (iii) solicit for
employment or engagement as an independent contractor, or for any other similar purpose, any
person who is at the time of the solicitation or was at any time in the 6-month period prior to the
solicitation, an employee or independent contractor (including an agent or broker) of the Releasing
Agency or its affiliates. It is understood that the prohibitions contained in this Section 4 do not
apply to Agent's agents who were in Agent's downline prior to the Effective Date.

 

[annon123]

I just started working an insurance, and the local agency i went had has had zero communication with me for two weeks. I recently met another local agency who offered way more. (Leads, CRM, VOIP, Medicare quoting and enrollment, agency support staff, etc) for free. They already loaded the CRM with leads, and the releasing agency just sent the paperwork over me to and this was added in it. The new agency sent it over to to their attorney's to be read because of this section they are concerned about.

can someone help explain what this means? and why the new agency is hesitant now?

Agent's Non-Solicitation Agreement. Agent acknowledges and agrees to the following:
For a period of twenty-four (24) months following the Effective Date, Agent agrees not to directly
or indirectly, for Agent or on behalf of another person or entity (including Accepting Agency and
its affiliates), (i) solicit any customers, agents, or brokers of Releasing Agency or its affiliates; (ii)
request, advise, or induce any person who is a customer, agent, broker, employee, contractor or
vendor of Releasing Agency or its affiliates to withdraw, curtail, or cancel, or engage in any other
activity that could adversely affect the relationship such person has with Releasing Agency or its
affiliates, which includes a prohibition on inducing or attempting to induce any of the Carriers'
policyholders or insurance product holders from whom Releasing Agency receives a commission
override to discontinue payment of premiums or cancel, surrender, relinquish, replace, or otherwise
cause termination of any policy or other insurance product with the Carriers; or (iii) solicit for
employment or engagement as an independent contractor, or for any other similar purpose, any
person who is at the time of the solicitation or was at any time in the 6-month period prior to the
solicitation, an employee or independent contractor (including an agent or broker) of the Releasing
Agency or its affiliates. It is understood that the prohibitions contained in this Section 4 do not
apply to Agent's agents who were in Agent's downline prior to the Effective Date.

I am not an attorney but it looks like the created the biggest net they could think of to protect themselves (which is probably the concern and likely some of what is in there isn't"usual" - although I wouldn't know that first hand) from:

1) you "taking" any customer in your book or the books of other agents for that agency. The problem, of course, is if someone decided to change agents you may well not know they were in the book of one of their agents or that one of their agents contacted them first.

I'd say it would be tough for them track clients whom were never their customers (eg their agency cold called them or one of their agents contacted them and they didn't sign on).

2) soliciting their agents, brokers or any independent contractor employees for anything at all (which would mean they'd likely try to blame you if any of those then also worked for your agency any time in the next 2 years).

3) That if any of those were already with the new agency in some way prior to when you joined them then the old agency is fine with it. The other stuff has look back or forward looking non-compete requirements.

Anything their attorney says obviously overrules anything I have typed here.

 

[Bogeyinvader]

I am not an attorney but it looks like the created the biggest net they could think of to protect themselves (which is probably the concern and likely some of what is in there isn't"usual" - although I wouldn't know that first hand) from:

1) you "taking" any customer in your book or the books of other agents for that agency. The problem, of course, is if someone decided to change agents you may well not know they were in the book of one of their agents or that one of their agents contacted them first.

I'd say it would be tough for them track clients whom were never their customers (eg their agency cold called them or one of their agents contacted them and they didn't sign on).

2) soliciting their agents, brokers or any independent contractor employees for anything at all (which would mean they'd likely try to blame you if any of those then also worked for your agency any time in the next 2 years).

3) That if any of those were already with the new agency in some way prior to when you joined them then the old agency is fine with it. The other stuff has look back or forward looking non-compete requirements.

Anything their attorney says obviously overrules anything I have typed here.

Thanks for the reply!

I have wrote zero business with this agency, I signed their contracts in Nov, and then nothing they promised has come through. I think they are more concerned with other agents leaving based off what this new agency is offering. I just did the CRM training, and it's pretty cool how phone calls, texts, emails all sync, quoting life, fe, medicare, etc on platform is really cool too. Not to mention they pay over rides on Medicare and better commissions on other products, and we own our books and they sign an immediate release, thats not dated and given to us. I'm really excited for this new agency just needing to be released from other carriers.

 

[annon123]

Thanks for the reply!

I have wrote zero business with this agency, I signed their contracts in Nov, and then nothing they promised has come through. I think they are more concerned with other agents leaving based off what this new agency is offering. I just did the CRM training, and it's pretty cool how phone calls, texts, emails all sync, quoting life, fe, medicare, etc on platform is really cool too. Not to mention they pay over rides on Medicare and better commissions on other products, and we own our books and they sign an immediate release, thats not dated and given to us. I'm really excited for this new agency just needing to be released from other carriers.

That you haven't written anything for your old agency should make it easier with respect to their concern about you taking clients with you. And that part, at least, is likely to be "pretty normal" (eg clients that you got under them stay with them and you can't take them with you). That affects the old agency's income stream and they care about that.

The rest of the stuff is likely what the attorneys are looking at to make sure there isn't going to be a negative impact on the new agency over the next two years for things out of your control based on how broadly they have written that.

Again I am not an attorney, although I have taught some business law to management students- that but is not the same as knowing this business from a legal point of view nor from the point of view of what an attorney looks at for how an agency operates or what in there might hobble their ability to to operate.

 

[m102269]

This agreement is basically a promise that, for 24 months after leaving your current agency, you won't try to take their customers, agents, or brokers to another agency (or to work with you directly). You also can't encourage anyone, whether it's their clients, employees, or contractors -to stop doing business with them or hurt their relationship with the agency. It even stops you from hiring or recruiting their employees or contractors who worked there within the last six months. There's one exception: agents who were already in your "downline" before this agreement started aren't included in these restrictions.

The new agency is hesitant because this clause is really strict and broad. It could get them into legal trouble if it looks like you're using any connections or relationships tied to your old agency. For example, if the leads they gave you include people tied to your old agency, it might count as a violation. They're probably worried about accidentally stepping into a lawsuit. You'll need to work with their legal team to figure out if this agreement is going to cause problems and, if so, how to handle it before moving forward.

 

[annon123]

This agreement is basically a promise that, for 24 months after leaving your current agency, you won't try to take their customers, agents, or brokers to another agency (or to work with you directly). You also can't encourage anyone, whether it's their clients, employees, or contractors -to stop doing business with them or hurt their relationship with the agency. It even stops you from hiring or recruiting their employees or contractors who worked there within the last six months. There's one exception: agents who were already in your "downline" before this agreement started aren't included in these restrictions.

The new agency is hesitant because this clause is really strict and broad. It could get them into legal trouble if it looks like you're using any connections or relationships tied to your old agency. For example, if the leads they gave you include people tied to your old agency, it might count as a violation. They're probably worried about accidentally stepping into a lawsuit. You'll need to work with their legal team to figure out if this agreement is going to cause problems and, if so, how to handle it before moving forward.

The problem looks like it would be for any agency change unless maybe moving into being a captive agent? That's a really restrictive non-compete. And there would be no way to know if the leads a new agency gives would be the same as the ones the old agency had for anyone in the agency. He'd only know if they were ones he, personally, was given, presuming he kept a record of that.

So if he hasn't left yet it would make sense to create a list of leads he was given, even though he didn't sell anything, so he can avoid those people if he is given them again with his new job.

If he is concerned that his old job will accuse him of taking leads with him then I'd bring them up on the computer and photograph them rather than screenshot, paste into a document, print...

 

[DonP]

I just started working an insurance, and the local agency i went had has had zero communication with me for two weeks. I recently met another local agency who offered way more. (Leads, CRM, VOIP, Medicare quoting and enrollment, agency support staff, etc) for free. They already loaded the CRM with leads, and the releasing agency just sent the paperwork over me to and this was added in it. The new agency sent it over to to their attorney's to be read because of this section they are concerned about.

can someone help explain what this means? and why the new agency is hesitant now?

Agent's Non-Solicitation Agreement. Agent acknowledges and agrees to the following:
For a period of twenty-four (24) months following the Effective Date, Agent agrees not to directly
or indirectly, for Agent or on behalf of another person or entity (including Accepting Agency and
its affiliates), (i) solicit any customers, agents, or brokers of Releasing Agency or its affiliates; (ii)
request, advise, or induce any person who is a customer, agent, broker, employee, contractor or
vendor of Releasing Agency or its affiliates to withdraw, curtail, or cancel, or engage in any other
activity that could adversely affect the relationship such person has with Releasing Agency or its
affiliates, which includes a prohibition on inducing or attempting to induce any of the Carriers'
policyholders or insurance product holders from whom Releasing Agency receives a commission
override to discontinue payment of premiums or cancel, surrender, relinquish, replace, or otherwise
cause termination of any policy or other insurance product with the Carriers; or (iii) solicit for
employment or engagement as an independent contractor, or for any other similar purpose, any
person who is at the time of the solicitation or was at any time in the 6-month period prior to the
solicitation, an employee or independent contractor (including an agent or broker) of the Releasing
Agency or its affiliates. It is understood that the prohibitions contained in this Section 4 do not
apply to Agent's agents who were in Agent's downline prior to the Effective Date.

This appears to be Medicare carriers ? Till March 31st you can self release not needing any release from the agency your leaving .

 

[goillini52]

This appears to be Medicare carriers ? Till March 31st you can self release not needing any release from the agency your leaving .

Where do you see that?

 

[DonP]

Where do you see that?

I've been told that many many times . I'm on many groups were all the fmo's preach to move your Medicare contracts by 3-31 . I'm talking mapd contracts . What it means is you can move them yourself without the fmo signing off . But I believe it can still take 90 days to move them. If you self release after march 31 it takes 6 months to move them. Again this is for fmo's that refuse to release you. But all your renewals stay with your old fmo until you move that business over the yrs . So even if you leave an fmo they'll still be making renewal overrides for many yrs .

 

[Bogeyinvader]

Hello this is for Final expense carriers, but I believe my old agency owner is worried that once other hears everything being offered he might lose more agents to the new one. Medicare Side I was never contracted with them.