Unmitigated Commission Chargebacks
- Thread starter Viverrid
- Start date
My friend is still considering fighting it, but it will be costly. Misrepresentation was claimed even though the agent went beyond the norm as far as documentation was concerned. the agent might win, but the time (years) it takes to sue makes most lawyers unwilling to take this on unless it is not on a contigency. There were claims of fraud, but no proof, the insurance company rolled because the daughter of the client was a lawyer and had the time and credentials to cost them high legal fees defending it.
The agent in question is an exceptional person, and is very ethical. The agent had migrated away from the said annuity company, so they felt no need to help. I saw all the correspondence involved, so I feel confident the agent was in the right, but the expense to fight it will be too great and no lawyer will take it on over a small amount like $15k.
I know of other agents for the same company who are active and fairly high producers who were not charged back and should have been based on the facts. The only difference was they are still with the company and are high producers.
The agent in question is an exceptional person, and is very ethical. The agent had migrated away from the said annuity company, so they felt no need to help. I saw all the correspondence involved, so I feel confident the agent was in the right, but the expense to fight it will be too great and no lawyer will take it on over a small amount like $15k.
I know of other agents for the same company who are active and fairly high producers who were not charged back and should have been based on the facts. The only difference was they are still with the company and are high producers.
- 14,809
Before he decides to fight - here's the time line for my buddy. Have this kind of time and money?
File Date:02/24/2006Close Dateecision: Party Type:PlaintiffParty No.:1 Document Name:Complaint
Doc No./Seq No.:1/1 File Date:03/31/2006Close Dateecision: Party TypeefendantParty No.:1 Document Name:Answer
Doc No./Seq No.:2/0 File Date:02/24/2006Close Date:02/27/2006Decision: Party TypeefendantParty No.:1 Document Name:Writ of Summons - Civil
Doc No./Seq No.:3/0 File Date:05/11/2006Close Dateecision: Document Name:Notices of Service of Discovery*
Doc No./Seq No.:4/0 File Date:06/27/2006Close Date:06/27/2006Decision: Document Name:Scheduling Order
Doc No./Seq No.:5/0 File Date:07/26/2006Close Dateecision: Party TypeefendantParty No.:1 Document Name:Counter Claim against ******
Doc No./Seq No.:5/1 File Date:09/13/2006Close Dateecision: Party Type:Counter DefendantParty No.:1 Document Name:Answer *
Doc No./Seq No.:6/0 File Date:07/26/2006Close Dateecision: Document Name:Notice of Service of Discovery
Doc No./Seq No.:7/0 File Date:09/06/2006Close Dateecision: Document Name:Notice of Service of Discovery
Doc No./Seq No.:8/0 File Date:09/11/2006Close Dateecision: Document Name:Notice of Service of Discovery*
Doc No./Seq No.:9/0 File Date:09/19/2006Close Date:09/13/2006Decision:Granted Document Name:Consent Motion for Protective Order
Doc No./Seq No.:10/0 File Date:11/15/2006Close Dateecision: Document Name:Notice of Service of Discovery*
Doc No./Seq No.:11/0 File Date:11/22/2006Close Dateecision: Document Name:Notice of Service of Discovery*
Doc No./Seq No.:12/0 File Date:01/11/2007Close Dateecision: Document Name:Notice of Service of Discovery*
Doc No./Seq No.:13/0 File Date:03/27/2007Close Date:03/27/2007Decision: Document Name:Notice of Postponed Trial Issued
Doc No./Seq No.:14/0 File Date:04/11/2007Close Dateecision: Document Name:Notice of Service of Discovery*
Doc No./Seq No.:15/0 File Date:04/19/2007Close Date:04/19/2007Decision: Document Name:Hearing Notice
Doc No./Seq No.:16/0 File Date:04/18/2007Close Dateecision: Document Name:Notice of Service of Discovery*
Doc No./Seq No.:17/0 File Date:07/03/2007Close Date:08/17/2007Decisionenied Party Type:PlaintiffParty No.:1 Document Name:Motion for Discovery Sanctions and/or in the Alternative, Motion in Limine
w/exhibits; Filed by PLT001-, CND001- Doc No./Seq No.:18/0 File Date:07/03/2007Close Dateecision: Party Type:PlaintiffParty No.:1 Document Name:Motion in Limine
Filed by PLT001-A, CND001- Doc No./Seq No.:19/0 File Date:07/03/2007Close Dateecision: Document Name:Certificate as to Rule 2-431
Doc No./Seq No.:20/0 File Date:07/10/2007Close Dateecision: Party TypeefendantParty No.:1 Document Name:Motion for discovery Sanctions and/or motion in limine
Doc No./Seq No.:21/0 File Date:08/03/2007Close Dateecision: Party TypeefendantParty No.:1 Document Name:Motion in Limine to Preclude The Testimony of Steven Plotkin
Doc No./Seq No.:22/0 File Date:08/03/2007Close Dateecision: Party TypeefendantParty No.:1 Document Name:Certificate as to Rule 2-431
Doc No./Seq No.:23/0 File Date:08/03/2007Close Date:08/08/2007Decision: Party TypeefendantParty No.:1 Document Name:Trial Memorandum and List of Witnesses and exhibits
Doc No./Seq No.:24/0 File Date:08/20/2007Close Dateecision: Document Name:Open Court Proceeding
August 20, 2007. Honorable Mickey J. Norman. Plainitff motion in limine (paper # 18000) RESERVED. Plaintiff motion to enter judgment of default to counter complaint - DENIED. Plaintiff request for postponment- GRANTED Doc No./Seq No.:25/0 File Date:08/29/2007Close Date:08/29/2007Decision:Granted Document Name:Order for additional information
Doc No./Seq No.:26/0 File Date:09/20/2007Close Dateecision: Party Type:Counter PlaintiffParty No.:1 Document Name:*Amended Counter Claim
Doc No./Seq No.:27/0 File Date:03/11/2008Close Date:03/11/2008Decision: Document Name:Hearing Notice
Doc No./Seq No.:28/0 File Date:06/10/2008Close Date:07/15/2008Decision:Granted Party Type:PlaintiffParty No.:1 Document Name:Motion to Strike Appearance of J A.as Counsel for the Plaintiff.
Doc No./Seq No.:29/0 File Date:07/15/2008Close Date:07/15/2008Decision: Party Type:PlaintiffParty No.:1 Document Name:Attorney Appearance Removed
J Doc No./Seq No.:30/0 File Date:07/15/2008Close Date:07/15/2008Decision: Party Type:PlaintiffParty No.:1 Document Name:Notice to Employ New Counsel Sent
File Date:02/24/2006Close Dateecision: Party Type:PlaintiffParty No.:1 Document Name:Complaint
Doc No./Seq No.:1/1 File Date:03/31/2006Close Dateecision: Party TypeefendantParty No.:1 Document Name:Answer
Doc No./Seq No.:2/0 File Date:02/24/2006Close Date:02/27/2006Decision: Party TypeefendantParty No.:1 Document Name:Writ of Summons - Civil
Doc No./Seq No.:3/0 File Date:05/11/2006Close Dateecision: Document Name:Notices of Service of Discovery*
Doc No./Seq No.:4/0 File Date:06/27/2006Close Date:06/27/2006Decision: Document Name:Scheduling Order
Doc No./Seq No.:5/0 File Date:07/26/2006Close Dateecision: Party TypeefendantParty No.:1 Document Name:Counter Claim against ******
Doc No./Seq No.:5/1 File Date:09/13/2006Close Dateecision: Party Type:Counter DefendantParty No.:1 Document Name:Answer *
Doc No./Seq No.:6/0 File Date:07/26/2006Close Dateecision: Document Name:Notice of Service of Discovery
Doc No./Seq No.:7/0 File Date:09/06/2006Close Dateecision: Document Name:Notice of Service of Discovery
Doc No./Seq No.:8/0 File Date:09/11/2006Close Dateecision: Document Name:Notice of Service of Discovery*
Doc No./Seq No.:9/0 File Date:09/19/2006Close Date:09/13/2006Decision:Granted Document Name:Consent Motion for Protective Order
Doc No./Seq No.:10/0 File Date:11/15/2006Close Dateecision: Document Name:Notice of Service of Discovery*
Doc No./Seq No.:11/0 File Date:11/22/2006Close Dateecision: Document Name:Notice of Service of Discovery*
Doc No./Seq No.:12/0 File Date:01/11/2007Close Dateecision: Document Name:Notice of Service of Discovery*
Doc No./Seq No.:13/0 File Date:03/27/2007Close Date:03/27/2007Decision: Document Name:Notice of Postponed Trial Issued
Doc No./Seq No.:14/0 File Date:04/11/2007Close Dateecision: Document Name:Notice of Service of Discovery*
Doc No./Seq No.:15/0 File Date:04/19/2007Close Date:04/19/2007Decision: Document Name:Hearing Notice
Doc No./Seq No.:16/0 File Date:04/18/2007Close Dateecision: Document Name:Notice of Service of Discovery*
Doc No./Seq No.:17/0 File Date:07/03/2007Close Date:08/17/2007Decisionenied Party Type:PlaintiffParty No.:1 Document Name:Motion for Discovery Sanctions and/or in the Alternative, Motion in Limine
w/exhibits; Filed by PLT001-, CND001- Doc No./Seq No.:18/0 File Date:07/03/2007Close Dateecision: Party Type:PlaintiffParty No.:1 Document Name:Motion in Limine
Filed by PLT001-A, CND001- Doc No./Seq No.:19/0 File Date:07/03/2007Close Dateecision: Document Name:Certificate as to Rule 2-431
Doc No./Seq No.:20/0 File Date:07/10/2007Close Dateecision: Party TypeefendantParty No.:1 Document Name:Motion for discovery Sanctions and/or motion in limine
Doc No./Seq No.:21/0 File Date:08/03/2007Close Dateecision: Party TypeefendantParty No.:1 Document Name:Motion in Limine to Preclude The Testimony of Steven Plotkin
Doc No./Seq No.:22/0 File Date:08/03/2007Close Dateecision: Party TypeefendantParty No.:1 Document Name:Certificate as to Rule 2-431
Doc No./Seq No.:23/0 File Date:08/03/2007Close Date:08/08/2007Decision: Party TypeefendantParty No.:1 Document Name:Trial Memorandum and List of Witnesses and exhibits
Doc No./Seq No.:24/0 File Date:08/20/2007Close Dateecision: Document Name:Open Court Proceeding
August 20, 2007. Honorable Mickey J. Norman. Plainitff motion in limine (paper # 18000) RESERVED. Plaintiff motion to enter judgment of default to counter complaint - DENIED. Plaintiff request for postponment- GRANTED Doc No./Seq No.:25/0 File Date:08/29/2007Close Date:08/29/2007Decision:Granted Document Name:Order for additional information
Doc No./Seq No.:26/0 File Date:09/20/2007Close Dateecision: Party Type:Counter PlaintiffParty No.:1 Document Name:*Amended Counter Claim
Doc No./Seq No.:27/0 File Date:03/11/2008Close Date:03/11/2008Decision: Document Name:Hearing Notice
Doc No./Seq No.:28/0 File Date:06/10/2008Close Date:07/15/2008Decision:Granted Party Type:PlaintiffParty No.:1 Document Name:Motion to Strike Appearance of J A.as Counsel for the Plaintiff.
Doc No./Seq No.:29/0 File Date:07/15/2008Close Date:07/15/2008Decision: Party Type:PlaintiffParty No.:1 Document Name:Attorney Appearance Removed
J Doc No./Seq No.:30/0 File Date:07/15/2008Close Date:07/15/2008Decision: Party Type:PlaintiffParty No.:1 Document Name:Notice to Employ New Counsel Sent
Exactly. This happened a year ago and I am sure the agent is not going to fight.
For those who don't know, the insurance companies can file what is called a Vector against an agent if there is what they determine to be a debit balance against the agent with their company. The Vector will show up if you try to get appointed elsewhere. It is pretty much a show stopper with most companies when it comes to getting appointed with them.
In this case they held commissions that were due to satisfy the debt.
For those who don't know, the insurance companies can file what is called a Vector against an agent if there is what they determine to be a debit balance against the agent with their company. The Vector will show up if you try to get appointed elsewhere. It is pretty much a show stopper with most companies when it comes to getting appointed with them.
In this case they held commissions that were due to satisfy the debt.
- 11,280
If the company decides to return the money after the 1st year it should not be held on the agents shoulders. The company kept the money for 3 years and earned interest, enough to pay the agents commission. It should be their loss not ours.
- 1,070
And here I am getting into annuities. I may make up my own form in large print that if they cancel for any reason they understand there will be costs. And I may expand on it as long as I know their possible behavior. CYA
- Thread starter
- #17
Got a lot of feedback, thanks everyone. The name of th carrier I am talking about is Midland National Life. I have 2 chargebacks from them, in both cases the annuities had been in force for 4 and 5 years respectively. In both cases the clients, I had documented and consistent contact with the clients, they were taking their penalty free withdrawals each year. In both cases a securities licensed broker came in to the picture and convinced the client that they had been put in to an inappropriate vehicle by me. The client complaint letters were written by the brokers and return addresses were the brokers offices.
This carrier in particular has bee rolling over in these situations rather easily and I think the brokerage world knows this.
There needs to be some sort of statute of limitation on this. We all know that if an annuity contract is surrendered or a death claim is filed with a certain period of time a chargeback is issued. But, to come back after several years and completely ignore the documentation I have is unbelievable.
There was a comment in this thread regarding the fact that the agents make "easy targets" for the carriers. Yes, I agree. Just curious, doesn't this complacency piss any of you off?
How about we band together here?
This carrier in particular has bee rolling over in these situations rather easily and I think the brokerage world knows this.
There needs to be some sort of statute of limitation on this. We all know that if an annuity contract is surrendered or a death claim is filed with a certain period of time a chargeback is issued. But, to come back after several years and completely ignore the documentation I have is unbelievable.
There was a comment in this thread regarding the fact that the agents make "easy targets" for the carriers. Yes, I agree. Just curious, doesn't this complacency piss any of you off?
How about we band together here?
- 11,280
If they were inforce 4 to 5 years, wouldn't the client have made more money by surrending the policy? I am assuming the company only refunded the initial deposit.
I agree that it is BS to chargeback after 5yrs if you did nothing wrong.
I agree that it is BS to chargeback after 5yrs if you did nothing wrong.
And do what? Refuse to write annuities?
That might get their attention if all agents did that, but otherwise, you are pretty much subject to their whim.
FWIW, I don't think most agents understand and appreciate the position the carrier is in when these things are challenged. It truly is a no win situation.
This is one of the reasons why carriers abandon certain markets. I don't write MA plans, but I understand quite a few carriers will not be playing in the upcoming season.
The annuity market is a difficult market to make money unless the carrier is playing tricks. Safeco was an early adopter in the EIA market and had a dynamite product. They wrote so much of it they lost their butt.
Other carriers have entered the market with bonus annuities and other tricks. They pay a big bonus and a big commission. The only way to support that kind of payout is to put a long tail on the early term penalties and enforce the MVA.
When they have to unwind one of those things the money comes from somewhere. Guess where some of the loss comes from.
- 868
If you are going to sell EIA you must have a series 6 at least to protect yourself from being accused of giving inappropriate investment advice.
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