Agla fires all agents

[DHK]

Just like Edward Jones firing an advisor during their 1st 3 years without cause. They can no longer go after that advisor for their "training costs" of $75,000 because they let them go.

 

[xrac]

Depends on what's on the list. HIPAA has to do with medical information... which I doubt would be on such a list. The violation would be on consumer privacy laws.

That being said, I personally believe that if a policy is sold by an agent, that the company has a duty to help ensure that the policy is managed by an agent. Now, a 'belief' doesn't necessarily make it legal, but it was the COMPANY that quit the agent force, not the agent quitting the company. That makes it a different situation.

If the agent wants to assume a more 'fiduciary' relationship with the clients they have been serving... why should a "mass firing" prevent a licensed agent from servicing these policyholders? In fact, it MAY be in the policyholder's best interest to replace these policies to those with a company who supports the agent business model, rather than just letting everyone go.

I think the company owes their policyholders an explanation as well as allowing them to continue to be served by the agent that sold them their policy (or agent of record or whatever). Former AGLA agents should be able to sign on with them as an independent and service the business they previously sold... or those who have a relationship with the agent will see that business replaced.

It's what's right for the consumer... and I'm willing to bet that would hold up in a court of law... because it was the COMPANY that abandoned the policyholder by eliminating their agent sales force... not the agent that didn't quit.

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Most companies also have agents sign a non-solicit agreement that the agent agrees to not solicit or replace business from a company for a period of 12-24 months.

Think about it: Such an agreement ALREADY IMPLIES that the agent has a list of policyholders when they leave. It's very common and it's how you build a career. You don't abandon your customers & clients when you change firms - if at all possible.

We should rename DHK. His screen name should be the Professor.

 

[heynow5]

Just like Edward Jones firing an advisor during their 1st 3 years without cause. They can no longer go after that advisor for their "training costs" of $75,000 because they let them go.

But they do have a 1 year no solicitation clause that says you can't contact your clients for 12 months. Doesn't matter if you knocked on doors and met them. Those are their clients. They can and will send cease and desist notices from their attorney if they find out you are or have contacted them. They have in the past and may pursue it further if you don't stop.

 

[DHK]

Ha! Thanks for the compliment!

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But they do have a 1 year no solicitation clause that says you can't contact your clients for 12 months. Doesn't matter if you knocked on doors and met them. Those are their clients. They can and will send cease and desist notices from their attorney if they find out you are or have contacted them. They have in the past and may pursue it further if you don't stop.

A fiduciary duty TRUMPS such a non-solicit agreement! Especially since EDJ are advisors, not just reps anymore, that can be held up because fiduciary duty IS linked to one's licensing and supercedes your employment contract.

Duty to clients is higher than duty to employer. That's why, if you find yourself into such a situation, you hire someone like Bill Singer to help defend you against the compliant and/or FINRA.

RRBDLAW.com & BrokeAndBroker.com Bill Singer

Or... you just don't go down that path in the first place and "begin with the end in mind".

 

[heynow5]

If you terminate from a BD doesn't that relationship end?

In my mind EDJ retains that duty and puts another advisor in your spot to fill it.

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by relationship I mean fiduciary duty.

 

[DHK]

Advisors move all the time for the up-front bonus contract money:
When You Move, Clients Move Too

 

[TDK]

Career agency companies take legal action against former employees frequently. They file action with the state insurance department which freezes the license. They file civil suits against the former employee and any broker or company which accepted sales that came as a result of breaking the non-compete agreement. AIG has a lot more money to spend on lawyers then a recently unemployed ex career agent will have. The arguments I am reading here are based on the way people think things should be or what seems fair. Reality is much different.

 

[xrac]

Ha! Thanks for the compliment!.

Your welcome. I am sure there are some quarters it would not be appreciated.

 

[DHK]

Clients have the right to pick to work with whomever they want, regardless of how the companies feel. Guess who would win THAT lawsuit if the client filed suit against the company from preventing that from happening?

As far as AIG having a lot more money... well, they let the career agency sales force go for some reason. I'm willing to bet that money was the #1 reason.

 

[heynow5]

As far as EDJ its not about where the client wants to go, they will let them go. Its about the non solicitation agreement the rep signed. So whens someone leaves, solicits clients, and then get the cease and desist letter I'd love to know what their lawuers will say when you tell them it's my fiduciary duty to do so. They will tell you where you can go.