An aggregator agreement is not just a formality — it is the legal document that defines your relationship with the aggregator, your carrier access, your commission structure, and what happens if you leave. Understanding the key terms before you sign can save you years of frustration.
Commission Structure and Splits
The commission section defines how you get paid. Look for clear answers to these questions:
- What is the split? Common structures range from 70/30 to 90/10 (agent/aggregator). IPA starts at 80/20.
- Does the split change over time? The best agreements reward growth. IPA transitions to a flat monthly fee at volume thresholds, meaning you eventually keep 100% of commissions.
- When are commissions paid? Look for clear payment terms and schedules.
- Are there any deductions beyond the split? Some agreements include technology fees, E&O deductions, or administrative charges that reduce your effective commission rate.
Book of Business Ownership
This is the single most important clause in any aggregator agreement. You need to understand exactly who owns the business you write and what happens to it under every scenario.
- Do you own your book from day one? Some aggregators only transfer ownership after a vesting period.
- Can you sell your book? Some agreements restrict sales or require the aggregator's approval.
- Can you take your book if you leave? Portability and ownership are not the same thing. You might "own" the book but be unable to move it to another aggregator.
- Are there buyout requirements? Some aggregators require agents to pay a buyout fee to leave with their book.
At IPA, the answer to "Do you own your book?" is unambiguous: yes, from day one, with no restrictions on selling, transferring, or taking it with you.
Termination Clauses
How can the relationship end, and what are the consequences? Key terms to look for:
- Notice period: How much advance notice does each party need to give? 30 days is standard for agents; aggregators typically have longer notice periods.
- Material breach: What constitutes an immediate termination event? Common triggers include compliance violations, fraud, or carrier misconduct.
- Post-termination obligations: What happens to in-force policies? Are there transition support requirements?
- Arbitration vs. litigation: How are disputes resolved? Binding arbitration is common.
Non-Compete and Carrier Restrictions
These clauses can significantly limit your options after leaving. Pay close attention to:
- Non-compete scope: Does it prevent you from joining another aggregator? For how long? In what geographic area?
- Carrier restrictions: Are you prohibited from working with certain carriers after leaving? How long does the restriction last?
- Non-solicitation: Can you reach out to the aggregator's other agents or staff?
- Non-interference: Are there restrictions on interfering with the aggregator's carrier relationships?
Technology and E&O Requirements
Many aggregator agreements require agents to use specific technology platforms and maintain certain insurance coverages:
- Required technology: Do you have to use their rating tools, CRM, or management system? Is the cost included or extra?
- E&O insurance: What are the minimum coverage requirements? Is E&O provided through the aggregator or do you need your own?
- Data and systems: Who owns the data in the systems? Can you export your client information if you leave?
Red Flags to Watch For
- Vague language around book ownership ("subject to" or "at the discretion of")
- Buyout requirements that increase over time
- Carrier restrictions that extend more than 12 months post-termination
- Technology fees that are not disclosed upfront
- Commission splits that never improve regardless of volume
- Automatic renewal clauses with long notice requirements
Get It in Writing
Verbal promises mean nothing. If the aggregator tells you "we always let agents keep their book" but the agreement says otherwise — the agreement wins. Every important term should be clearly stated in the written contract. If something is unclear, ask for clarification in writing before you sign.