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Rewards to Agents for Referrals

So, is this the same type of thing that Safelite, which had the "Rewards Program", (if I remember correctly,) is counter-suing Diamond over?

Basically, gifts and gratuities to agents in exchange for referrals is the issue, as I understand it.

An agent's primary fiduciary responsibility is to their insured, so if the agent is making recommendations based on what benefits the agent, and his pocket, in the form of gifts and gratuities, rather than what was in the best interests of the insured, is this improper? Better yet, why isn't the 'gift' or 'reward' being given to the insured directly?

Regardless of state laws, which definitely don't allow this in some states, the question becomes one of ethics, I would suppose.

Re: Rewards to Agents for Referrals

Diamond no longer does any type of Agent Referrals and have not done them for some time under the new leadership.

Re: Rewards to Agents for Referrals

The thing is Safelite has the "sgc network reps" do all the "customer relations" with insurance companies they TPA for, in order to avoid the "steering" claims and questions about ethics. Wining and dining your current client is NOT illegal as far as I know, they may say.

Of course, we all know that could lead to direct referrals by agents to SGC retail outlets, despite what the SGC network says, and despite Hal's famous "China wall" quote. If SGC can directly talk to my shop, they surely can talk, dispatch, and control the actions of THEIR OWN retail outlets.

Re: Rewards to Agents for Referrals

Ok, let me clarify just a bit.

If Safelite is successful in suing Diamond, what's to stop them from using the precedent to turn right around and sue Iowa Glass?

I mean, let's be real, there is only ONE reason to offer a rewards program, and it's to get agents to over-ride the call centers so that Auto Glass Centers get the jobs.

Safelite went 'back in time' to sue Diamond over this action, so what's to stop them from doing the same with Iowa Glass?

If this is 'different' than what Safelite is citing in the Diamond complaint, then what's the difference?

Seems to me this practice would come to a screeching halt until the industry sees of Safelite is successful.

Then, there's the whole comparison of this kind of 'commission' to what Spitzer has done in New York to the insurance brokers, putting millions into state coffers for fines and settlements due to them taking improper commissions rather than doing what was best for the customer. That has to tie into this at least somewhat.

Re: Rewards to Agents for Referrals

Glass America gives $25.00 gas cards to agents for referrals. I know because my brother is an independent agent, and he has been solicited as has many of his insurance buddies. Though their workmanship is atrocious, many agents line their pockets at the expense of their insureds. Diamond has
as far as i know stopped all kick backs.

Re: Rewards to Agents for Referrals

How can you offer an agent even a handshake (unless you run into him on the street) it states in the TPA's contract that AG owners/sales people are not allowed to call on the agents or market themselves at all, no notepads, pens, mousepads, muffins or lunches....any of the things my employer used to do.

Re: Rewards to Agents for Referrals

Newby, please tell me which agreement you are quoting from, or please post the wording also.

I don't think I have that one, and would like to see that verbage.


Re: Rewards to Agents for Referrals

Lets not forget the SANS coop buying program that Glass America gives back a percentage of the total dollars to the agent.

I was told at last years SANS convention Glass America was handing out big checks to the agents right on the floor.

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