IIAA States Its Efforts Have Led to ChoicePoint Decision to End Sales of Agent-Owned Data

January 24, 2002

On Jan. 24, the Independent Insurance Agents of America (IIAA) released the following statement:

“Direct-marketing and consumer-lead-generation service provider ChoicePoint agreed to end data-mining of independent agency and broker insurance transactions following a Jan. 9 meeting with Independent Insurance Agents of America (IIAA) officials, says IIAA executive vice president & general counsel Debra L. Perkins.

“On Jan. 14, less than a week after the meeting at IIAA’s Capitol Hill office with Perkins and C. Wesley Bissett, vice president of state relations and state government affairs, ChoicePoint sent a letter to IIAA announcing its decision to cease creating or using shopping dates from insurance quote and underwriting transactions submitted to the firm by independent agents or through companies on agents’ behalf.

“ChoicePoint was using dates culled from insurance quote and underwriting transactions submitted to the firm by or on behalf of independent agents and brokers to create ‘shopping dates’ when consumers would be most likely to be shopping for insurance. The firm then sold this information to other agents and insurance companies in lead lists.

“IIAA first raised its concerns about this practice with ChoicePoint last August after being alerted to the company’s practice when an IIAA member purchased a prospect list from ChoicePoint that included a number of his own agency clients.

“‘We believed ChoicePoint’s practice was encroaching on the rights of independent agents and brokers to own and control their proprietary data, which includes shopping or expiration dates,’ asserts Perkins.

‘This is a fundamental right of independent agents and brokers that we believe was being overlooked by ChoicePoint. Their actions were tantamount to selling an agency’s client data base to other agencies and insurance companies.

“‘Through ongoing discussions with IIAA, ChoicePoint agreed to respect independent agent and broker rights concerning their propriety data. The agreement ensures that the practice will cease and all ‘shopping date’ information originating from independent agents and brokers will be purged,’ says Perkins. ‘We are very pleased with ChoicePoint’s decision to end this practice and applaud its desire to maintain a positive relationship with the agent and broker community.’

“In the Jan. 14 letter to IIAA, ChoicePoint agreed to ‘immediately discontinue the creation of shopping dates’ and to ‘immediately purge from its database historical shopping dates associated with underwriting transactions…originating from independent insurance agent product orders.’

“For agents and brokers, the most important and valuable part of their businesses is expiration dates. If competitors gain access to an agency’s client list and expiration dates, it can use the information to time marketing efforts toward these consumers during the period leading up to the expiration of their policies. Agency ownership of expirations was reaffirmed by a New York court decision nearly a century ago and has become accepted practice within the agency system, notes Perkins.

“IIAA was advised by several insurance companies, including Progressive Insurance, MetLife Auto & Home, MSA Group, and others, that they were opposed to ChoicePoint’s use or sale of shopping dates. Several insurers also informed IIAA that they had amended their contracts with ChoicePoint to preclude the firm from using agent and broker information, regardless of whether the inquiries were submitted directly by agents and brokers or by the insurance companies on behalf of agents and brokers, says Perkins.

“‘IIAA appreciates that insurance companies independently assessed this practice and concluded that it was an unacceptable use of agent information,’ says Perkins. “‘IIAA takes seriously its advocacy role for independent agents and brokers,’ says Perkins. ‘We remain vigilant and will call into question any practices that we believe will have a negative impact on agencies and brokerage firms.’

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