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P. Simmons
P. Simmons, Attorney
Category: Legal
Satisfied Customers: 34753
Experience:  16 yrs. of trial experience
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What is the law regarding a licensed insurance producer slandering

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What is the law regarding a licensed insurance producer slandering a company by explaining to a prospect that a competitor doesn't have a legal health plan
Thanks for the chance to help. I am an attorney with over 12 years experience. Hopefully I can help you with your legal question.

Can you give a bit of context here...AZ law on defamation depends on the facts...what happened exactly?
Customer: replied 6 years ago.
I own a PEO with a legal health plan. A competitor exclaimed to the prospect that we do not have a legal health plan. The prospect told us so. As a licensed broker there is a law amongst brokers that you may never provide any insecurity regarding insurance carriers due to the bank run in the 20's when people took all their money bc of fear. The competitor is a licensed broker. Hope this helps
Is the prospect a company or an individual? Did the prospect refuses coverage based on this false information?
Customer: replied 6 years ago.
The prospect is the owner of a veterinary clinic and we(competitor and I were fighting for the business of the clinic. The owner emailed that the other company had told them this misrepresentation. We have not lost the prospect yet.

The main law that applies will be ARS 20-445 (part of the AZ insurance Code). Here is the law

No person shall make, publish, disseminate or circulate, directly or indirectly, or aid, abet or encourage the making, publishing, disseminating or circulating of any oral or written statement or any pamphlet, circular, article, sales material or literature which is false or maliciously critical of or derogatory to the financial condition of an insurer, and which is calculated to injure any person engaged in the business of insurance, or any domestic corporation or group being formed pursuant to this code for the purpose of becoming an insurer. This provision shall not be deemed to restrict the right, lawfully exercised, of newspapers, magazines, radio and television stations, and similar public media for news dissemination, objectively to publish and disseminate news.

As you can see, the above language is you can report this to the State Insurance Commissioner.

And request that they take action for this improper conduct.

This is a separate action from the civil action of defamation...Defamation is defined as a false statement communicated to another person that damages your reputation by exposing you to hatred, contempt, or ridicule from other people. Libel is communicating a defamatory statement by writing or picture. Slander is defamation by oral or spoken communication.

To sue for defamation, you need to prove "damages"...that the person (or in this case company) was harmed by this false information. TO prove damages you need to prove that there was if the prospect refuses to retain the company based on this false information, then the company would have a defamation case.

Let me know if you have more questions

P. Simmons and 2 other Legal Specialists are ready to help you