MOBILE, Alabama – A local insurance agent has won a $2.4 million judgment against Farmers Insurance Group after a civil trial last week in which he accused the company of lying about its policy regarding independent agents.
Robert “Kyle” Morris, who had been working for his family’s independent insurance agency, sought to become a Farmers agent in 2006. He told Farmers that he did not want to de-affiliate from the Morris Insurance Agency, according to testimony. Farmers officials told him it would not be a problem.
The company, in fact, did have a policy since 2003 requiring its agents to work exclusively for Farmers. Brian Duncan, an attorney who represented Morris, said the company simply lied to his client. Morris, he said, never would have accepted the offer from Farmers had he known about the policy.
In December 2009, after a management change at Farmers, the company sent Morris a termination letter without explanation. Duncan said the company told Morris, after he pressed for an answer, that the termination was due to the policy.
“It was a case, really, about telling the truth to somebody,” he said.
Attorneys for Farmers could not be reached over the weekend. They argued at trial that it did not matter what Famers managers had told Morris because he signed a contract giving them the right to terminate him with 90 days’ notice.
Duncan argued that the company committed fraud, which negated that provision of the contract. He said Farmers not only took all of the clients that Morris had built up over 2½ years but also the ones he brought with him when he came aboard. That was a total of 250 customers, with 310 policies worth some $630,000 a year in premiums, he said.
What’s more, Duncan said, the contract had a non-compete clause prohibiting Morris from contacting his former clients for a year.
Duncan said Morris went back to the family insurance agency, where he works today, but essentially lost three years of his career.
“He did have to start from scratch,” he said.
A Mobile County Circuit Court jury on Friday awarded Morris $600,000 in compensatory damages to compensate him for lost commissions and $1.8 million in punitive damages.