Insurance Agent Forum

[retread]

Originally Posted by healthagent

Joe I really want your take on what protection an agent should have in this situation:

FMO recruits newbie - promises top commission, training and free leads.

Newbie signs on. Comes to find there's no training, no leads and he's 20% lower than other FMOs.

What system would you put in place that would allow that agent to blow out? Under our current system that agent is screwed.

Been, there, done that, got the T-shirt, and the hat!

[Joe Moore]

Originally Posted by healthagent

Well that was a fantastic non-answer.

As you can see, agents have zero protection under the current system. Since we have zero protection we are only recommending that agents sign up with FMOs offering a full upfront unconditional release except in cases of negative balances.

Right now there are three such FMOs that I know of - all offering top contracts to boot.

The question is, since they are offering top contracts, full training and support and upfront release - what do you have to bring to the table?

Sorry, guess I did get carried away a little.

My short answer to this would be: Yes, a release should be given if asked for.

[healthagent]

What gets is in most cases it's an illegal clause. By illegal I mean it's not anywhere to be found in writing which means it cannot be enforced - yet it is.

One of these days the wrong agent is going to sign on of these contracts, not get released and actually sue. Some agent with time and money.

It would be priceless for both the carrier and FMO to stand up in court and explain how this "ghost clause" can be enforced.

[Joe Moore]

Originally Posted by healthagent

What gets is in most cases it's an illegal clause. By illegal I mean it's not anywhere to be found in writing which means it cannot be enforced - yet it is.

One of these days the wrong agent is going to sign on of these contracts, not get released and actually sue. Some agent with time and money.

It would be priceless for both the carrier and FMO to stand up in court and explain how this "ghost clause" can be enforced.

What I think needs to be remembered is that insurance companies have the right to say who is appointed with them, and who is not. This is not an employer-employee relationship. It is an "Independent Contractor" situation.

If IMOs have a continual in-and-out shuffling of agent heirarchies, or if agents are considered "trouble makers" by a company; the company does not have to keep them around, or allow them to become contracted. The companies have the right to say who represents them.

We have at times tried to get agents contracted with a company and the agent checks out fine. But, some executive with the company has previously declared the agent "not rehirable". This may even be something personal. End of case. No discussion. No argument.

I am not sure any court anywhere would try to tell any company they would have to "rehire" anyone as an "Independent Contractor". The company would only have to claim that the IMO or Agent had previously violated a company's operational policy.

[healthagent]

....how are you addressing trying to enforce a contractual provision that's not found in writing?

[xrac]

The problem with releases and agents is usually the agent has no clue they even have to have a release or how difficult one may be to obtain until they have experienced the problem. I didn't know anything about releases until I left one shop to join another. Then I found out that it would be 6 months before I was released by the other agency. Plenty of IMO's take advantage of this lack of experience.

[dolau]

Oh. I was thinking of some other kind of "release".

Carry on.