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Old 08-12-2017, 07:51 PM   #1
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Arbitration / Lawsuit Question Arbitration / Lawsuit Question
I wanted to know if there is any legal action I can take vs. another agent for fixed insurance business?

I used to work for a captive agency and was working with another agent on a case. We agreed that we would split the business 50/50 if I did the leg work (his referral and contact). I designed the case and sold it. It resulted in a sizable life insurance sales as well as a SPIA sale. The day of the sale, the other agent went to client and had signed the papers without putting me down for 50% because he knew I was leaving to go independent and thought he could cut me out. I have all illustrations, emails, notes of work I did for the client as well as communications between the other agent as well as the client.
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Old 08-12-2017, 08:56 PM   #2
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Arbitration / Lawsuit Question Re: Arbitration / Lawsuit Question
The "legal action" you can take is called a lawsuit. If the money involved is within your state's small claims court limit, you can sue in small claims court for your share of the commission.

Understand that you don't have to sign a contract to have a contract and that oral agreements are just as enforceable as written agreements, just harder to prove.

Your communications with the other agent as to the 50% agreement would be useful in court.

I wouldn't bother with arbitration if this fits into small claims court.

What state are you in and how much money is involved?
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Old 08-12-2017, 09:01 PM   #3
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Arbitration / Lawsuit Question Re: Arbitration / Lawsuit Question
Originally Posted by RK38 View Post
I wanted to know if there is any legal action I can take vs. another agent for fixed insurance business?

I used to work for a captive agency and was working with another agent on a case. We agreed that we would split the business 50/50 if I did the leg work (his referral and contact). I designed the case and sold it. It resulted in a sizable life insurance sales as well as a SPIA sale. The day of the sale, the other agent went to client and had signed the papers without putting me down for 50% because he knew I was leaving to go independent and thought he could cut me out. I have all illustrations, emails, notes of work I did for the client as well as communications between the other agent as well as the client.
I don't know if this captive agency allows the agent to split with brokers or not. Sometimes if the agent is on 'financing' plans, they can't split with independents (I think?).

Anyway, you can give him one of two choices:
1) Have it corrected for 50% of the commissions generated
2) Have him write you a check for that amount and issue a 1099 at the end of the year. (Option 2 is clearly more beneficial for him because he won't lose any conference/sales credits with the home office.)

If not, then you can take it up with an attorney for legal action.
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Old 08-12-2017, 09:22 PM   #4
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Arbitration / Lawsuit Question Re: Arbitration / Lawsuit Question RK38 is the thread starter for: Arbitration / Lawsuit Question

Originally Posted by adjusterjack View Post
The "legal action" you can take is called a lawsuit. If the money involved is within your state's small claims court limit, you can sue in small claims court for your share of the commission.

Understand that you don't have to sign a contract to have a contract and that oral agreements are just as enforceable as written agreements, just harder to prove.

Your communications with the other agent as to the 50% agreement would be useful in court.

I wouldn't bother with arbitration if this fits into small claims court.

What state are you in and how much money is involved?
New York. Commissions were about 40K from my portion of it. Trying to determine what type of lawyer would be best suited for this. Surprisingly, I called about four securities attorneys and only one sounded like they knew the insurance side of the business. However, that specific attorney's retainer was extremely high compared to the others.
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Old 08-12-2017, 09:49 PM   #5
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Arbitration / Lawsuit Question Re: Arbitration / Lawsuit Question
Originally Posted by RK38 View Post
New York. Commissions were about 40K from my portion of it. Trying to determine what type of lawyer would be best suited for this. Surprisingly, I called about four securities attorneys and only one sounded like they knew the insurance side of the business. However, that specific attorney's retainer was extremely high compared to the others.
$40K is certainly beyond NY's small claims court limit and it's not a lawsuit you want to try on your own.

I'm not sure that the insurance or securities angle is the way to go. You had a contract for commission. Shouldn't make any difference that the product was insurance or a widget.

This is more of a contracts issue and it should take a contracts (general business) attorney who can look at your evidence and determine if an enforceable contract actually existed.

Yes, you are likely to have to pay an attorney by the hour with a retainer and you need to be willing to spend the money to pursue the lawsuit if you have to, although a scary letter from an attorney might get your enemy to hand over the money.

Hope for the best, plan (and budget) for the worst.
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