Hey, good morning! Rich here with Summit Life Group. So, what is a release in the insurance business? When I first got my life insurance license, I didn’t know what a release was or what it meant. Some of you may be new to the life insurance space or the insurance industry in general, or perhaps you’re considering getting into it. I try to provide value here on our channel to help you better understand the industry and how it works, so I thought I’d take a few minutes to explain what a release is. Hopefully, this helps you as you evaluate your decisions and career path in the insurance business.
As an independent life insurance agent, you need to represent various insurance companies in order to sell their products. However, what many people don’t realize is that, in most cases, you can’t go directly to an insurance company and obtain a contract yourself. There are exceptions—some companies do allow direct contracts—but most insurance companies today require you to obtain a contract through an agency.
If you’re new or considering getting your insurance license, this may be unfamiliar territory. To represent the larger insurance companies, you typically need to get a contract through an agency, even if you’re getting paid directly by the insurance company. Ideally, that agency provides the value you need—training, support, leads, etc.—to help you succeed in selling life insurance.
Now, what happens if you decide to go in a different direction? Maybe the agency you’re working with isn’t the right fit anymore, whether it’s due to lack of support, training, or other factors. A release is when that agency agrees to sign off and allow you, as an independent agent, to obtain that insurance contract through a different agency. That’s what a release is.
When evaluating agencies to partner with, one important thing to consider is: Will the agency release your contract if you decide to go in a different direction? This is just something to be aware of. It doesn’t necessarily mean you shouldn’t work with a particular agency, but as an independent agent, it’s important to be informed.
There are agents who succeed greatly with agencies that don’t sign releases—that’s just how some agencies operate. On the other hand, many agencies do offer releases, so it’s something to keep in mind as you make career decisions. The goal isn’t for you to jump from agency to agency, but life and business can change, and you might find yourself needing to switch agencies at some point.
For agencies that do sign releases, there’s typically a condition: making sure the agent doesn’t have any outstanding debt or chargeback balances with insurance carriers. Most agencies that release agents will want those balances cleared up first, which is fair practice.
If you’re working with an agency that won’t release you, most insurance companies have a standard policy. Generally, if you don’t write any new business for a period of six months (even if you’re still receiving commissions), you can often move to another agency without requiring a release. This can vary by insurance company, but it’s a general industry practice.
The goal is always to find an agency you enjoy working with and where you don’t need a release. However, situations change, and it’s important to know how releases work. Agencies with strict non-compete clauses or large contracts with extensive terms are usually the ones that won’t provide a release, so be aware of that when signing.
People often ask, “Does Summit Life Group sign releases?” Absolutely. We believe in supporting independent agents, and if an agent feels we’re not the right fit for them, we fully respect that. We’re happy to sign a release and allow that agent to take their contract elsewhere. Our goal is to support independent insurance agents, provide value, and help people grow. If we’re not the right fit, we respect their decision to move on.
Again, many agencies operate the same way, but many do not, so be informed. Our goal is to educate and provide value, helping you understand who we are and what we believe in. No one explained to me what a release was when I first started, so I wanted to take a few minutes to clarify it for you.
If you’re an independent insurance agent or looking to become one, and you’re searching for an agency to partner with, check out Summit Life Group. We specialize in tele sales and supporting agents across the country. We may or may not be the right fit for you, but we are the right fit for a lot of agents out there who want to learn how to sell over the phone. If you’d like to learn more about Summit Life Group, just fill out the link below.
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