As you may recall, one of my carriers has put in place a “freeze,” prohibiting agents from freely choosing with whom they do business (click here for details). When last we discussed this, I was awaiting an opportunity to discuss the situation with the Attorney General’s office.
That opportunity knocked yesterday. In a conference call arranged by my state rep’s able assistant, I had the pleasure of speaking, for about 45 or 50 minutes, with an attorney in the Anti-Trust office.
And it was a very interesting conversation.
First, she asked me to explain for her the nature and significance of the problem, which I did [ed: why didn’t you point her to the blog post, smart guy?]. She then asked a number of probing questions:
■ Is this switching very common? Is it an easy or difficult process? I told her that, as far as I am aware, it is not a very common practice; that is, I don’t know a lot of agents who switch around often. It does seem like a fairly easy process, though: just sign a form (much like an Agent of Record letter that a client might use).
■ Could an agent have more than one GA (General Agent)? Yes, but not for the same carrier. That is, perhaps GA #1 offers access to XYZ Mutual and ABC Life, while GA #2 offers Anon Life and ASAP Health. I could sign up with both of them, because each offers different carriers.
■ Are GA’s local, regional, or national? I’m not aware of national GA’s, at least in the types of insurance I generally sell.
■ Do I think that several GA’s got together and pressured the carrier to put the freeze in place? That was, as they say, the “money question.” I knew immediately that she was looking for evidence of conspiracy. The problem is that, really, I have no such evidence, merely speculation and logic. I explained to her that, much as I’d like to help on that issue, I really had no proof that this was the case. Of course, it’s the most logical explanation, but that’s not the same thing. Still, since it’s a possibility, perhaps she can use that.
I certainly hope so.
■ Do other carriers have such restrictions? Another great question, on a number of levels. Unfortunately, I didn’t know the answer, but promised to get it for her as quickly as I could.
By the way, here’s why I couldn’t answer that one: I cannot imagine a scenario where I would want to switch GA’s. I’ve had a terrific working relationship with my current GA for almost 10 years, and have no desire or reason to switch. BUT, it is appalling to me that a carrier could prohibit me from doing so.
Since I’ve had no (recent) experience in switching, I didn’t know whether or not other carriers also had a freeze on. The only reason I knew about this one was because a colleague had called to ask me about it, and I subsequently received a letter which confirmed it.
And so, I called my own GA, and asked them. Currently, none of their other carriers have such a freeze, although others have had, in the past. I’ll pass this information on to the Attorney General’s office, and await further developments. She did, however, ask me to send her a copy of the letter, which I promptly did.
Toward the end of my conversation with the AG, the subject of what outcome I’d like to see came up. That, too, is a good question. I thought for a moment, and answered that I really didn’t want “heads to roll;” rather, a simple cease-and-desist would be just fine. In other words, all I really want is for the AG to tell the carrier that this is wrong, and to stop it (and, of course, refrain from any future such freezes).
See, I’m not unreasonable. Just stubborn.
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