Client relationships are the most critical asset possessed by any insurance agency, and when an agency finds itself competing for those relationships against its own former employee, relations can become especially ugly. Ask a spurned employer about the impact of the loss of one of its top producers, and the conversation might sound like a hard-luck love song full of loss, anger and regret. Given what's at stake, this is completely understandable—yet it is highly preventable.

The loss of key employees or independent producers, whether through voluntary departure or termination, is a fact of life for all types of professional service firms. Insurance agencies and brokerages have been turning to non-competition, non-disclosure and non-solicitation agreements to help them protect their books of business and stanch the bleeding when a departure occurs. 

Brokerage and agency leaders have said holding onto their critical client and employment relationships is the top issue keeping them up at 4 a.m. This is in part because of uncertainty created by the inconsistent treatment of these contracts under various states' laws.