How to Make an Upline Change 

In order for a business to be successful all parties involved have to benefit or the relationship will eventually break down.

As an insurance agent, it’s likely only a matter of time until you find yourself in a situation where you feel that your upline partnership isn’t working for you.

When that happens, it may be time to cut ties with your current upline and move on. This can be a simple or complicated process, depending on your upline FMO and the carrier involved.

It is important first to understand that, if the carrier in question will honor a signed release from your upline, it needs to be from the highest level in your hierarchy. Carriers will not accept a signed release from a mid-tier FMO.

For example, as an FMO we have a direct relationship with the carriers we broker for. For the most part, carriers will honor our release requests, no questions asked.

We have a general open release policy and would normally process a release without delay. Having said that, we also give our mid-level down lines flexibility to implement their own release guidelines and allow them to release down lines as they see fit, as long as carrier guidelines are respected.

For the most part there are 2 ways to transfer your contract to a new upline. A “Signed Release” or a “Self-Release”.

Let’s take a look at these options:

Signed Release:

An agent may request to be released from their upline for immediate transfer to a new FMO. It is important to stress that this request must be signed by the top level upline and NOT by a mid-tier. If the top line FMO signs the release, the agent is then free to transfer to a different broker immediately.

Self Release:

If an upline doesn’t want to give an agent an immediate release, then an agent can exercise the Self-Release process. It may vary by carrier, but as a general rule there are a couple of ways to do it:

• An agent stops writing business for a period of time, usually 6 months, and they will be able to transfer at the end of the time period due to non-production.
  • Most Med Supp carriers follow this Self-Release process
• An agent may submit a notice to the carrier detailing their intent to transfer to a new broker. The agent should be able to continue to write business (depending on the carrier) for a time frame specified by the carrier. When that time frame is up, the agent will be allowed to transfer their contract to the broker named in the original intent letter.
  • Most Med Advantage carriers follow this Self-Release process

Below is a sampling of a few carriers and their release process:

Aetna Med Advantage/Part D - Notice and new contracting must be sent to Aetna to start the clock. You can continue to write business during their 3 month Self-Release period.

Mutual of Omaha - Non-Production for 6 months will allow an agent to transfer their contract.

Aetna Med Supp - Email notice must be sent to Aetna Supplemental to start the clock. You can continue to write business during their 6 month Self-Release period. However, different guidelines apply if you have producing downlines.

Humana - Notice and new contracting must be sent to Humana to start the clock. You can continue to write business during their 3 month Self-Release period.

United Healthcare – Email notice must be sent to UHC to start the clock. You can continue to write business during their 6 month Self-Release period.

Transfer Freezes

Some Med Advantage carriers implement transfer freezes in the 4^th Quarter of each year, which prevents an agent from transferring their contract no matter what the release scenario may be. UnitedHealthcare, Aetna, and Humana are a few of the major carriers who implement a transfer freeze period. 

With that being said, it’s important to carefully consider the timing if you’re looking to initiate a self-release.

For example: If an agent were to start a self-release and that self-release time frame expired in the middle of a transfer freeze (9/1/19 to 12/31/19), they would be forced to stay under their current upline until the end of the freeze period. In other words, they are stuck until after AEP and usually until January 1^st of the next year.

Obviously, if the agent could have timed the self-release so that the self-release time frame expired before the freeze period, that may have been the more favorable situation.

Again, not all carriers have the same process, so ensure you understand the carrier’s requirements before starting the process.

The important thing to remember is that, if your business relationship isn’t working, you have options. It is also a good idea to understand the release policy of your upline, before you work with them, so you are not surprised when the situation arises.

Your success is up to you, but a bad business relationship can definitely make that success more difficult.

If you have any questions, our experienced marketers are here to help.