The insurance brokerage industry is experiencing a period of unprecedented talent mobility. Largescale producer lift-outs and team hires, once episodic, have become a defining market feature. Recent litigation between Brown & Brown and Howden U.S. Services, arising from the sudden movement of approximately 200 employees, underscores how quickly and aggressively competitors are willing to recruit established teams in today’s environment. Howden’s intensive recruitment of U.S. insurance talent has drawn lawsuits from several of the largest insurance brokers in the country, including Aon, Marsh, WTW and Brown & Brown.
At the same time, employers are recalibrating retention strategies in light of the effective demise of the Federal Trade Commission’s (FTC) proposed nationwide non‑compete ban. While the FTC’s rule now appears largely abandoned, it would be a mistake for insurance brokerages to assume that restrictive covenants — or talent protection strategies more broadly — are back to “business as usual.” They are not.
The FTC’s non‑compete ban: Where things actually stand
In April 2024, the FTC adopted a rule that would have banned nearly all post‑employment non‑compete agreements nationwide, preempting state law and retroactively invalidating most existing restrictions. However, as predicted by MarshBerry, that rule never took effect (see The FTC Finalizes Its Non-Compete Rule—but the Issue is Anything but Final).
In August 2024, a federal district court in Texas vacated the rule in its entirety, holding that the FTC lacked statutory authority to promulgate such a sweeping regulation. The FTC initially appealed, but following a change in Commission leadership, the agency formally abandoned its appeal and acceded to the rule’s vacatur in September 2025.
As of January 2026, there is no federal ban on non‑competes, enforceability is governed entirely by state law, and the FTC has signaled a shift toward case‑by‑case enforcement against “unfair” or coercive restrictions rather than a blanket ban. For insurance brokers, this means regulatory fragmentation — and risk. Multi‑state operations now face a patchwork of tightening state laws, increased scrutiny of restrictive covenants, and heightened litigation exposure when employees depart with clients or data.
The rise of the producer lift‑out
The abandonment of the FTC rule has coincided with the insurance industry’s intensifying competition for revenue‑producing teams, particularly in middle‑market and specialty lines. The Brown & Brown/Howden dispute exemplifies the modern lift‑out model: near‑simultaneous resignations, rapid client transfers via broker‑of‑record letters, and allegations of pre‑departure coordination along with misuse of confidential information. Massachusetts courts have already issued a temporary restraining order limiting further solicitation and recruitment while the case proceeds.
What makes these disputes more common — and more dangerous for brokerages — is that even where non‑competes exist, they are less reliable than many firms assume, and they are rarely the strongest line of defense. Instead, brokers increasingly rely on breach of confidentiality obligations, breach of non‑solicitation covenants, theft of trade secrets, breach of duty of loyalty, and tortious interference with contracts. In short, firms that rely solely on non‑competes are likely under‑protected.
How insurance brokerages should protect against producer poaching
Here are five strategies for any broker looking to strengthen its line of defense against a talent raid:
1. Re‑engineer restrictive covenants (don’t just renew them)
Firms should immediately audit employment and producer agreements across jurisdictions. In 2026, the most effective, restrictive agreements have well-defined qualities. The strongest restrictive covenants are:
- Narrowly tailored to protect legitimate interests.
- Focused on non‑solicitation of clients and employees, not outright competition.
- Backed by meaningful considerations such as a raise, bonus, or other tangible benefits for existing employees.
- Regularly updated to align with evolving state law.
In sum, courts are far more willing to enforce client non‑solicitation clauses — particularly in producer‑driven businesses — than broad non‑competes.
2. Treat confidential information like it actually matters
Many brokers lose trade‑secret cases because they fail to treat data as confidential before an employee leaves. Best practices include:
- Written confidentiality acknowledgments updated annually.
- Tiered access to books of business, carrier data, and compensation metrics.
- Device management and exit protocols that immediately disable access.
- Clear documentation identifying what constitutes a trade secret.
Litigation trends show that courts scrutinize behavior, not labels, when determining whether information is protectable.
3. Strengthen duty‑of‑loyalty safeguards
Producers remain free to plan their departure but not to recruit co‑workers, solicit clients, or misuse employer resources while still employed. Brokerages should:
- Clarify duty‑of‑loyalty obligations in written policies.
- Train managers to escalate suspicious pre‑departure behavior.
- Monitor bulk downloads, unusual broker-of-record activity, and sudden client communications.
Claims grounded in breach of loyalty often survive even where non‑competes fail, but that breach has to be documented and provable.
4. Use employee retention tools the market actually respects
Sophisticated competitors win (and retain) talent by offering deferred compensation and retention bonuses, equity or phantom equity participation, and long‑term incentive plans tied to client retention metrics. Brokers that rely only on legal tools without offering competitive compensation often find those tools to be stress‑tested and insufficient.
5. Prepare for litigation before it’s needed
Finally, firms should assume that lift‑outs will continue, and they must plan accordingly. That means that organizations should establish rapid‑response legal protocols for when team departures occur, pre‑select forensic vendors and outside counsel, and engage in consistent enforcement (selective enforcement undermines credibility). As the Howden litigation demonstrates, delay can be fatal once clients begin transferring en masse.
Conclusion: The war for talent isn’t slowing down
Non-competes may be still allowable and enforceable under law, but that’s unlikely to slow the forces driving talent raids in the insurance sector. Brokerages that cling to outdated agreements or assume that loyalty will substitute for structural protection do so at significant risk. The most resilient firms in 2026 will combine precise legal drafting, disciplined information‑governance, competitive economics, and decisive enforcement. Anything less is an invitation to become part of the next lift‑out headline.
