LifeQuote chases Network Data ARs for clawbacks
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Protection firm LifeQuote has written to former appointed representatives of defunct Network Data asking for clawbacks for cancelled polices.
LifeQuote, a trading style of Direct Life & Pension Services, says it tried to recoup the money from the network’s administrators but was unsuccessful.
ARs have been given 30 days to pay the clawbacks, some of which date back to 2009.
Phil Jeynes, national accounts manager at LifeQuote, would not comment on how much the firm needs to pay in clawbacks.
He says: “As with ARs of any network, if we cannot recoup the money from the network we go to the AR.
“We have been a bit delayed in writing to brokers because we originally applied to the administrators for the clawbacks, which was not successful.
“We recognise that some of the ARs will be out of pocket just like ourselves.”
Jeynes says it will look at each case individually and if any ARs did not receive the commission originally from Network Data it will take this into consideration.
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Readers' comments (7)
Anonymous | 7 Oct 2010 2:02 pm
Best of luck with that one!
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Anonymous | 7 Oct 2010 2:22 pm
Lifequote would not be able to go after the ARs if it was not a term in their contract. Consequently, former Network Data ARs will not be able to use the arguement that they are owed commission (relating to other deals) by the Network, so they are not going to repay the clawback, as they want to "offset" the debt.
If they don't pay, they will struggle to continue in the industry, with the annual F&P declarations requiring them to disclose any unpaid indusry (and other) debts.
With the recent reported losses by 2 of the larger Networks, this does make the choice between joining a Network and being Directly Authorised focus more on financials, rather than support offered.
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Anonymous | 7 Oct 2010 2:40 pm
I used to deal with lifequote but with the clawback system they employ, the agent has to pay back all of the commission that the life company requests, including the part paid to lifequote. Needless to say I no longer use them. I hope that the ARs take legal advice on it as I would say that the contract was between the network and lifequote. Good luck guys and girls.
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Anonymous | 7 Oct 2010 3:41 pm
When Network Data went into receivership, pipline business was not paid to advisers by the receivers as the business belonged to Network Data. Therefore the policies are Network Data's and not the former AR's so the only recourse they have is with the Receivers.
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Anonymous | 7 Oct 2010 4:08 pm
As an ex AR of NDL I refused to deal with Lifequote, a stance which I continued when I moved to another network who champion them.
Most if not all insurers in the NDL debacle have taken the hit on the chin in the knowledge that some of their future income will still come from some of the these brokers.
It's very sort sighted on Lifequotes part to take this stance and I would urge brokers of all networks to consider going direct to the insurers. Even if you think the network is financially stable, do consider that NDL appeared to be along with the others that have fallen since and more are likely to follow.
Yes their recommendation letters are quite nice and the tele-underwriting is a nice idea, but many insurers do tele-underwriting without such a large chunk of your earnings and if you cant write a recommendation for yourself then I'm not sure you should be recommending anything to anyone.
To add insult to injury, some of the people affected by this not only didn't get paid, but their clients have been contacted by Phoenix who the administrators of NDL did a deal with and it's my understanding that they receive the renewal commissions with none of the liabilities.
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Anonymous | 7 Oct 2010 5:36 pm
Lifequote's contract quotes that an agent may claim against themselves for any unpaid commission.(Section 7v)on termination.How do the agents stand where Lifequote have paid agents commission to a Network in financial difficulty knowing the agent is unlikely to be paid?
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Anonymous | 7 Oct 2010 6:33 pm
Not only have you got lenders and the FSA 'broker bashing', now it looks like the life companies are having a go. So what are they going to do, chase the broker for money that the broker probably never got paid in the first place - good luck with that then!
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