Declatory Relief Action

UFAA filed a Declaratory Relief Action in California asking a court to interpret a number of provisions of our Agent Appointment Agreement.  This is not a lawsuit of the traditional variety.  We are not seeking monetary damages, only the court's determination of what our AAA really says on certain provisions that we seem to interpret differently than the management company does.

If we are successful in California and the Company doesn't apply the beneficial changes territory-wide, then will proceed on a state basis, making Texas the next where we file.  

While we are not seeking money, a favorable outcome will result in a substantial savings to almost every agent.  We believe that Farmers has a contractual obligation to provide the access to the Network as specified in paragraph A3 of our Agents Appointment Agreement.  We believe the court will agree with us and the result will mean agents with a System 36 will save a minimum of $210 a month.  Agents with the AS400 will save about $400 a month and those using IVANs will save a minimum of $120 a month.   

Another item included in the DRA, but not discussed in the issue, is a question over the contractual ability to broker business where Farmers doesn't offer one or more requested or required coverage's.  A good example is the recent announcement that the broader additional insured endorsement for commercial liability policies will no longer be issued forcing agents to rewrite those policies to other company's (which the Company states would be a contact violation) or face losing those policies. 

UFAA has taken a stand to protect the interests of its members and the agency force and has chosen the least confrontational manner in which to accomplish this.  We do not relish being placed at odds with our Company, but we had no other viable option.  I hope you will join with us in contributing to our DRA Fund.  If you have any questions, please feel free to let us know.

Click Here to go to more information about the DRA and to see actual documents, etc.