Agent of record, what is it? Man, if you’ve heard that term before, there’s no telling what the background is behind that conversation. But I’m going to tell you that the agent of record letter is not wrong. Like you have to have an agent of record on your account. Period. Whether you realize it or not, you already have one. The reason that agent of record letters exist is not so that shady insurance agents can get you to sign something to move your coverage without them doing the work to earn it. The letter is for you to choose the carrier you want to work with and then assign the agent you tell them via this letter.
Agent of Record: How Does it Work?
Suppose I write a lot of business with Chubb, and I call on you. You like my value proposition (because you feel like Florida Risk Partners can bring more value to your organization than you’re currently receiving). In that case, you can make me your agent with Chubb by merely declaring that on an agent of record letter. Now, agent of record letters have a bad rap in the agent community. Often, agents feel like somebody is sleazy, and they’re just trying to steal their work or take their account when nobody’s looking or whatever else. I can tell you unequivocally throughout my career that the overwhelming majority of agent of record letters get appropriately used.
What can go wrong?
Now, there are some bad apples out there that abuse the system, but most of the time, those are payroll companies who like to throw agent of record letters for the workers’ comp into your onboarding paperwork if you choose to engage with payroll services. When you get approached for an agent of record letter, you need to make sure that it is something that you agree with, that you understand that you are now hiring that person to represent you, and you are firing your current representation. And if you don’t feel comfortable with that, don’t sign it.
What do I need to Know?
Part of the process is for guys like me to educate people like you on exactly what you’re doing. We explain how to handle the conversation with the person you’re unfortunately going to have to let go of because they weren’t delivering what you needed them to deliver. I can tell you that it is infrequent that an agent of record letter gets tendered against an incumbent agent who is doing their job. If your agent isn’t cutting it, but you love your carrier relationship, agent of record letters are your tool. The letter is a weapon you can use to preserve your risk management program’s integrity and the relationships you’ve built with your insurance company partners. You have the flexibility of taking on a value proposition that is unfamiliar to you yet refreshing based on our meeting.
It’s up to you. You get to decide. It’s not the agent who tells you who represents you. It’s you, the buyer. And I hope that you have found this series useful and that you click down below and download the e-book we put together on ways to purchase insurance because I think that you will find the information we’ve included very valuable.