The Agreement Is the First Document to Pull, Not the Last
The instinct when a producer is underperforming is to focus entirely on the performance conversation: written warnings, a production plan, a final deadline. What gets skipped, almost every time, is pulling the producer’s own signed non-compete and non-solicitation agreement and reading it, while they are still employed and the conversation is still hypothetical.
That order matters. Once a termination conversation has already happened, an agency is reacting to whatever the agreement says, instead of knowing what it says going in. Reading it first does not change the decision to let someone go; it changes how much the agency actually knows about what happens next.
What the Agreement Can Stop Them From Doing
As of February 2026, there is no federal ban on non-competes. The Federal Trade Commission’s April 2024 rule, which would have banned most non-compete agreements nationally, was vacated by a federal district court in Texas that August, and the FTC formally abandoned its own appeal in September 2025. Enforceability is governed entirely by state law, per MarshBerry’s February 2026 analysis of the current landscape.
The same analysis notes that courts are “far more willing to enforce client non-solicitation clauses, particularly in producer-driven businesses, than broad non-competes.” In practice, that means a narrowly written clause preventing a departing producer from soliciting the specific clients they served is a materially stronger tool than a broad, generic non-compete a court is more likely to narrow or refuse to enforce at all.
The Real Cost of Getting a Replacement in the Seat
Firing a producer is also a budget decision, whether or not it feels like one in the moment. Replacing a producer costs 75% to 150% of their departing salary, $15,000 to $50,000 in direct cost, according to data cited from the Big I and Reagan Consulting Best Practices Study. Three mid-level exits in a single year can run an agency $146,000 to $292,000.
None of that argues against firing someone who genuinely is not performing. It argues for going into the decision knowing the real number, so the choice gets made on the actual cost of the alternative, a producer who is not producing, rather than an assumption that termination is free once the conversation is over.
Why Departures Are Rarely as Contained as an Agency Expects
Large-scale producer departures are no longer a rare, isolated event in this industry. MarshBerry’s own analysis points to the Brown & Brown and Howden dispute, involving roughly 200 employee departures in a single event, as evidence that large-scale producer “lift-outs” are now “a defining market feature,” not an occasional risk. A single termination is a smaller version of the same underlying dynamic: a departing producer, contested agreement or not, can be a magnet for other producers watching how the situation gets handled.
That is a second, separate reason the agreement matters before the conversation happens. An agency that already knows what a departing producer can and cannot legally do is in a far better position to manage that ripple effect than one finding out in real time.
What to Check Before the Conversation
Practitioner checklist, not a cited statistic: confirm exactly what the producer’s agreement restricts, client solicitation, a defined geography, a time window, and whether it reads like the kind of narrow clause courts tend to enforce or a broad one that may not hold up. Pull a current list of the accounts they actually service, since that list is what a non-solicitation clause is meant to protect. Have a documented performance record ready, not because most states require “cause” for an at-will termination, but because a documented record makes any later dispute, over the agreement or anything else, easier to defend.
Line up a plan for the accounts on day one, even a temporary one, so clients hear from the agency before they hear from anyone else. Time the conversation deliberately, too: the day after a major renewal cycle closes is a different decision than the week before one opens.
Treating Termination as a Business Decision, Not Just a Performance One
None of this argues for keeping an underperforming producer longer than the agency should. It argues for making the decision with the same rigor an agency would apply to any other five-figure business decision, because that is what it actually is once replacement cost, client retention risk, and legal exposure are all counted together.
Keeping new-business meetings landing on the calendar during a producer transition is its own separate problem, and one worth solving before the transition happens, not after. Human + AI SDRs can keep that flow of qualified conversations moving while an agency works through exactly this kind of decision.
Sources
The external data in this article draws on the sources below. Figures described in the text as estimates or industry triangulations are directional and are not attributed to a single dataset.
- MarshBerry, Non-Competes Still Exist, But So Do Talent Raids
- The Insurance Dudes, citing Big I and Reagan Consulting producer turnover data