HF 440

as introduced - 90th Legislature (2017 - 2018) Posted on 01/26/2017 05:00pm

A bill for an act
relating to insurance; prohibiting the enforcement of certain restrictive covenants
against involuntarily terminated agents; proposing coding for new law in Minnesota
Statutes, chapter 60A.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

new text begin [60A.181] INVOLUNTARY TERMINATION OF AGENT;
ENFORCEABILITY OF CERTAIN RESTRICTIVE COVENANTS.
new text end

new text begin A covenant or agreement entered into by an insurer and an agent is void and
unenforceable if:
new text end

new text begin (1) the agent was involuntarily terminated by the insurer; and
new text end

new text begin (2) the covenant or agreement prohibits one or both of the following activities:
new text end

new text begin (i) working in a specific geographic area for a specific period of time after the cancellation
or termination of the agency contract; or
new text end

new text begin (ii) soliciting employees of the insurer or soliciting or transacting business with customers
of the insurer.
new text end

new text begin EFFECTIVE DATE; APPLICATION. new text end

new text begin This section is effective the day following
final enactment and applies to a covenant or agreement in effect on, or entered into on or
after, that date.
new text end