A non-compete clause restricts your ability to work in the insurance industry — or solicit your clients — for a specified period after leaving an agency or aggregator. Common terms include: a geographic radius (25-100 miles), a time period (1-2 years), and restrictions on contacting clients you serviced.
Non-competes are separate from book ownership. You can own your book but still be restricted from actively soliciting those clients during the non-compete period. Understanding both is critical before signing any contract.
It depends on your state. Several states have banned or severely limited non-competes in recent years — including California, Oklahoma, North Dakota, and Minnesota. The FTC has also pursued broader restrictions. In states where non-competes are enforceable, courts generally require them to be reasonable in scope, duration, and geography.
Duration: 6 months to 1 year is usually reasonable. 3+ years is often struck down.
Geography: A 25-mile radius is more enforceable than a 200-mile radius or a statewide restriction.
Scope: Restricting you from all insurance work is likely overbroad. Restricting you from soliciting specific clients you serviced is more likely to hold up.
Consideration: You must have received something of value (employment, access to carrier appointments, book of business) in exchange for the restriction.
Some aggregators include non-compete clauses. Others explicitly state they have none — this is a selling point. Before joining any aggregator, check the contract for language about what happens when you leave. Key terms to look for: non-solicitation, non-compete, non-piracy, exclusivity, and restrictive covenants.
An aggregator that lets you own your book but includes a 2-year non-compete effectively traps you — your book is yours on paper but you cannot do anything with it for two years.
Read every word. Non-competes are often buried in long contracts. Look for sections titled Restrictive Covenants, Non-Competition, Non-Solicitation, or Post-Termination Obligations.
Negotiate the terms. Non-competes are negotiable. Ask to reduce the duration, narrow the geography, or limit the scope to active clients only.
Get it removed entirely. Some agencies and aggregators will remove the non-compete if you ask. The worst they can say is no.
Consult an attorney. For contracts involving your livelihood, a $500 attorney review is worth it. They can identify problematic clauses you might miss.
Check your state law. If your state bans non-competes, the clause may be void regardless of what you signed.
See which aggregators have non-competes — and which do not.
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