Can a lawyer take estate-planning referrals from an insurance agent and let the agent pay the lawyer's fee?

Plain-English summary

The inquiry concerned referrals from an insurance agent, the agent's submission of a questionnaire to clients recommending the lawyer, and the effect on the attorney. The committee noted that the inquiry produced heated debate and a split of opinion, and said its split should signal that the inquirer not rely on the informal opinion to support any action against civil liability.

On the first question, whether a lawyer may draft a trust and pour-over will for an insurance agent's client where the agent wishes to pay the fees, the committee was of the opinion that if the attorney accepts the fee from the agent, RPC 1.2, 1.8(f), and 5.4(c) are mandated and the attorney must exercise independent professional judgment and give the client candid, independent advice regardless of who pays. On the second question, where the client pays and is reimbursed by the agent, the committee said the attorney must comply with RPC 1.2 and 1.7(b) and maintain independent judgment in light of the expectation of future referrals from the agent.

On the third question, whether an agent forwarding a questionnaire recommending the lawyer's trust-preparation services violates RPC 7.3, the committee found no prohibition against a lawyer being recommended by an insurance agent to the agent's client, provided the communications about the lawyer's abilities do not create an unjustified expectation about results (RPC 7.1(b)), and provided the lawyer gives nothing of value to the agent for the recommendation except the reasonable cost of advertising (RPC 7.2(c)). The committee cautioned that the attorney must take care that the agent-initiated relationship does not become an RPC 7.3 solicitation driven by the attorney's pursuit of pecuniary gain, and must protect the client's confidences and secrets unless the client consents after consultation (RPC 1.6).

Currency note

This opinion was issued in 1997, before the Washington State Bar Association's adoption of the 2006 revisions to the Rules of Professional Conduct. Subsequent rule amendments or later opinions may have changed the analysis. Treat this page as historical context, not current guidance. Verify against current rules before relying on any specific rule, deadline, or requirement mentioned here. Washington's cited rules correspond to ABA Model Rules 1.2 (scope), 1.6 (confidentiality), 1.7 (conflicts), 1.8(f) (compensation from a third party), 5.4(c) (professional independence), 7.1 (communications), 7.2 (advertising; recommending services), and 7.3 (solicitation).

Common questions

Q: Can a lawyer let an insurance agent pay the lawyer's fee for a client's trust and will?

A: The committee said yes if the attorney accepts the fee from the agent only while satisfying RPC 1.2, 1.8(f), and 5.4(c) and exercising independent professional judgment with candid, independent advice to the client.

Q: What if the client pays and is reimbursed by the agent?

A: The committee said the attorney must comply with RPC 1.2 and 1.7(b) and maintain independent judgment given the expectation of future referrals from the agent.

Q: Can the insurance agent send clients a questionnaire recommending the lawyer?

A: The committee found no prohibition, provided the communications do not create unjustified expectations about results (RPC 7.1(b)) and the lawyer gives the agent nothing of value beyond the reasonable cost of advertising (RPC 7.2(c)).

Q: What confidentiality limit applies?

A: The committee said the attorney must protect the client's confidences and secrets unless the client consents after consultation, under RPC 1.6.

Background and rules framework

The opinion applied the third-party-payer and independence rules (RPC 1.2, 1.8(f), 5.4(c), and 1.7(b), corresponding to ABA Model Rules 1.2, 1.8(f), 5.4(c), and 1.7) to the agent's payment of the lawyer's fee, and the advertising and solicitation rules (RPC 7.1(b), 7.2(c), and 7.3, corresponding to ABA Model Rules 7.1, 7.2, and 7.3) to the agent's recommendation, with RPC 1.6 (confidentiality, corresponding to ABA Model Rule 1.6) overlaying the whole arrangement. The committee permitted the referral relationship while flagging independent judgment, the bar on paying for recommendations, and the line into improper solicitation as the constraints; it stressed its own division on the question.

Citations and references

Rules of Professional Conduct:

• ABA Model Rule 1.2 (scope of representation); Washington RPC 1.2
• ABA Model Rule 1.6 (confidentiality); Washington RPC 1.6
• ABA Model Rule 1.7 (conflicts of interest); Washington RPC 1.7(b)
• ABA Model Rule 1.8(f) (compensation from one other than the client); Washington RPC 1.8(f)
• ABA Model Rule 5.4(c) (professional independence of a lawyer); Washington RPC 5.4(c)
• ABA Model Rule 7.1 (communications concerning a lawyer's services); Washington RPC 7.1(b)
• ABA Model Rule 7.2 (advertising; recommending services); Washington RPC 7.2(c)
• ABA Model Rule 7.3 (solicitation of clients); Washington RPC 7.3

See also

• WA Ethics Op. 1681: Group Legal Marketing Program
• WA Ethics Op. 1646: Union Referral of Members to Lawyers

Source

• Landing page: https://ao.wsba.org/print.aspx?ID=767

Original opinion text

Reproduced from the official source for research purposes. The linked source is authoritative.

Advisory Opinion: 1693
Year Issued: 1997
RPC(s): RPC 1.2; 1.6; 1.7(b); 1.8(f); 5.4(c); 7.1(b); 7.2(c); 7.3
Subject: Payment of lawyer's fee by third party; solicitation; referral by insurance agent

The following is a response to your inquiry regarding referrals from an insurance agent, the agent's submission of a questionnaire to his/her clients and what effect it may have on the attorney. Please be advised that your inquiry led to much heated debate and split of opinion among the committee. Furthermore, the committee believes that its split of opinion should be an indication to you not to rely on this informal opinion to support any action of civil liability to which you, as an attorney, may be subjected.

The committee responds to the following issues:

(1) Is it ethical for an attorney to draft a trust and a pour-over will for a client of an insurance agent, where the agent wishes to pay the fees for the preparation of those documents?

[2) Would the opinion differ if the client paid the fee and was reimbursed by the agent?

[3) Would the forwarding of a questionnaire by the insurance agent to his/her client recommending the lawyer's services for preparing trusts violate RPC 7.3?

It is the opinion of the committee that:

(1) If the attorney agrees to accept his/her fee from the insurance agent, RPC 1.2, 1.8(f) and 5.4(c) are mandated and the attorney must exercise independent professional judgment and provide the client candid and independent advice regardless of whether the fee is paid.

(2] If the attorney is to be paid by the client (who shall be reimbursed by the insurance agent), the attorney must comply with RPC 1.2 and 1.7(b) and maintain independent judgment in light of and expectation of future referrals from the agent.

(3] There is no prohibition against a lawyer being recommended by an insurance agent to the agent's client for purposes of having legal documents drafted, provided the communications regarding the attorney's abilities are not done in a manner to create an unjustified expectation about the results the lawyer can achieve (RPC 7.1(b)); and provided the lawyer does not give anything of value to the agent for recommending the lawyer's services except for the reasonable value for cost of advertising (RPC 7.2(c)). Likewise, the attorney needs to take care that the relationship initiated by the insurance agent does not breach into an RPC 7.3 relationship, where the initiative is that of the attorney seeking pecuniary gain. Finally, it will be incumbent upon the attorney to protect the client's confidences and secrets unless the client consents after consultation. RPC 1.6. In addition, RPC 1.2, 1.8(f), 5.4(c), 1.7(b), 1.6, 7.1(b), 7.2(c), and 7.3(a) and (b) may be found helpful.