Obtaining new clients is always a challenging task for most insurance agents, and even more so when a current prospect is actively shopping around.
In your communication with the prospect, the prospect may mention another agent or agency, or talk about products offered by a carrier. This may lead to the temptation to badmouth that other agent, agency or carrier.
Perhaps you know the competition, and have legitimate concerns about the way that agent, agency or carrier conducts business. This does not give you license to make disparaging comments directed at the competition, and there are many good reasons to refrain from doing so.
Defamation is the deliberate attempt to discredit the name and/or reputation of another entity by means of false, malicious or derogatory statements. And if it can be proven that you communicated the derogatory information to another—verbally or in writing—you may be in line for an expensive lawsuit that will probably cost you much more than a new client would ever make you in commissions or fees.
If an agent is in competition with a life insurance company, and the agent tells a potential client something like they have heard the company is having financial difficulties, is laying off agents and closing offices. If any of this is untrue, the agent is defaming that company and acting unethically.
It all comes down to a commitment to ethical marketing practices. Agents that do this can enhance not only their own reputation, but that of their agency and the carriers they represent.