by Structured Settlement Watchdog
The word "partner" is often used loosely in business today. The word "partner" has a legal connotation however, which may
characterize or convey something to the public about your structured settlement broker or settlement planner's relationship to that insurance company that may not be legally correct.
When Howdy Partner Turns Into "Howdy Doody"
With this in mind, and in the spirit of the best practices guide that I am developing, I have asked the annuity issuing life companies to respond with their company's position with respect to the following two questions:
1. Is an appointed general agency and/or appointed agent or sub agent legally a partner in your company?
2. Does the compliance department in your company condone the use of the word "partner" in advertising or on web sites of appointed general agencies or appointed agents and/or sub-agents of that general agency.
Here are four of the responses:
Company A. "Thanks for the question. Your relationship with XXXXX is solely and legally as a "licensed insurance agent". Do no use the word partner in any way as that has significantly different legal connotations. As a reminder, you agency contract dictates that any use of our name in any external advertising (website, flyers, advertising, etc..) must be approved by XXXXX Legal before proceeding."
Plaintiffs, Lawyers, Insurance Company claims representatives, Judges and Trial Lawyer Associations should be aware of that the use of the word "partner" may not be permitted under the contract between the person or company soliciting you for business or for your approval of the settlement and may indeed be considered a violation of truth in advertising rules in your state.
As a point of interest, Insurance agencies or agents who use the word "partner" in conjunction to an agency relationship may be needlessly exposing themselves to "bad faith" lawsuits against the annuity issuers or the qualified assignees (particularly an assignee that is a property casualty company). According to the Business Dictionary "partnership by estoppel" is a legally binding partnership that may arise where, in fact, no formal partnership agreement is in effect. A person who by conduct or words represents, or allows him/herself to be represented, as a partner in a firm is liable for the credit or loans obtained by firm on the basis of such representation. Also called presumption of partnership." WOW! WOW and WOW!