25+ Free Agency Agreement Templates [MS Word]

free agency agreement template 6

An agency agreement template is used by many companies when they use the services of another company. They use it to represent them as their agent on their company matters. In an agency agreement, two parties are involved. When the principal assigns the representation to the agent then a legal relationship created between these two parties.

The benefits of an agency agreement:

Nowadays, agencies have become the norm for companies. This is because they remove the burden of having to deal directly with specific problems. Therefore, during dealing with an agent, an agency agreement becomes an important document to understand.


An agency agreement offers various benefits to small business owners. Not everyone has the right skills and knowledge that are required to operate a business. It becomes important to seek the services of a professional. Moreover, avail the services of one who would act as their representative and conduct business matters in an effective manner.

For the principal, having an agent can make things easier for the principal. Since this is the convenient way to handle certain business issues. But the need of an agency agreement is also necessary.


The risks of an agency agreement:

Likewise any other type of agreement, an agency agreement also has some risks. Having an agent has its own drawbacks to represent you in business dealings. Any wrongdoing that an agent gets involved in will reflect on the principal because the agent is the legal representative of the principal.

For example, without the knowledge of the principal and being a representative of the principal, the agent can enter into a contract. This way, the principal is answerable for all of the contract’s terms and conditions even if he hasn’t read it.

While writing an agency agreement, by using outright language and the limitations of the liabilities, the principal should indicate in the clearest terms and conditions.


What basic details should be included in a general agency agreement?

General agency agreements may vary depending on the type of work required and the risks that are incurred by both the principal and the agent. The following basic details are included in all;

Scope of services

The specific services that the agent is to provide should be mentioned in the contract. Also, specify in the contract that new agreement should be signed in case any services outside the scope of the contract are required.



In this section, describe how compensation will proceed in case the services mentioned in the contract are completed according to the principal’s satisfaction.


The agent may experience various expenses while providing the services outlined in the contract. You should clearly state in the contract how records of these costs should be kept. Also, specify that when invoices have to be submitted.

Relationship of the principal and agent

In the contract, clearly describe that the language of the contract should never be misconstrued in order to suppose that an employer-employee relationship exists.


Additional clauses to include:

Your agency agreement template may also include the following clauses;

Confidentiality and intellectual property

When your contract has confidentiality section, it prevents the agent from disclosing confidential information without written permission. The procedures about the return of intellectual property or the destruction of sensitive material can be included.


The agreement should explain how the relationship among the principal and the agent have to be ended and at what point the agreement will no longer be effective. If the agreement is terminated on the basis of the principal’s breaches of material provisions then clarify when outstanding balances will be paid.

Dispute resolution

The contract should acknowledge the potential for future conflict while the primary purpose of the general agency agreement is to prevent disputes. Also, explain in the contract how disputes will be settled.

How to use an agency agreement?


A principal starts the agency agreement. The principal is the one who is looking for an agent that will handle certain services for his business. The agreement has information sheet that includes important details about parties, the principal and the agent. It also emphasizes the type of business the principal engages in. The agency agreement defines certain important characteristics. These characteristics exit between the principal and agent. Such information includes;

  • The duration of the agency
  • Fee information
  • Why the principal required an agency

The duration of the agency indicates the length of time that the principal requires the agent. It may also refer to the time that principal allow the agent to continue and complete the services. In addition, the duration also refers to the service ending at a specified date.

The agreement is printed out after filling out all the relevant information provided by both parties. Then, both the parties sign it. For the duration of the agreement, keep copies of the agreement on file. Before the principal and the agent relationship commences, this agreement outlines the expectations of both parties.

Things to consider in an agency agreement:

During dealing with an agency agreement, keep the following factors in mind;


The agent should get paid all the payments through the author within thirty days of receipt other than some charges from the bank and foreign payments. The author has to take charge of these payments. This is also an important point.

Agent hasn’t allowed to charge any additional costs. But some of these agents add fees for certain activities such as purchasing extra copies, photocopying for submission, etc. The agreement should explain terms of deductions and whether or not you obtain the approval of these charges clearly.


Submissions are now made through emails so it may not a tricky subject. There should be no reason for agents to make deductions for postal costs because huge postage charges have also desisted. Commission is another item that you have to clarify in an exclusive agency agreement.


For each submission, the principal should also receive notification. Since there is no any approval for the submission but it is customary to get consulted about it. The agreement made with the publisher must be get subjected to the author’s approval as he is the signatory of each agreement.


Don’t grant an agent power of attorney:

You shouldn’t assign the responsibility of contracts to agents even you are out of town or the country where there is a need for a power of attorney. Before issuing a power of attorney, you should think twice because this document is a very powerful tool.


You have to ensure that the agent is never granted the rights to a book. May be the author separated from his agent but he still has the rights to the author’s book and due to a power of attorney undoing this predicament is a very difficult task.


In the agency agreement, there is need to be a termination clause when the relationship between the author and agent do not work out and to get out of this situation. This clause has a timeframe notice i.e. between one to three months. Moreover, the contracts remain in place that agent negotiated. For such contracts, he will receive the agreed-upon commissions. You should never take termination clause light because it is a standard part. Also, keep in mind that no agreement can be changed without the agent’s agreement.


You can’t be sold or bought any agency as it’s a business. Include a non-assignment clause in an agency agreement in order to make sure that the agency representing you won’t get sold to a third party. Also, this isn’t a standard clause as nowadays more agencies are getting sold or choose to join forces.

Mistakes to avoid in agency agreement:

Value language

Don’t use vague terminology as it leads to confusion or even disputes. Instead, include figures like deadlines or dollar amounts because they instantly deliver the expectations held by both parties.

Neglecting document security

Nowadays, agency contracts are signed digitally. But, this approach can prompt security concerns so provide a safe and streamlined workflow for eSign.


Scanning the document

In an agency agreement, every detail matters so before signing, analyze the complete template carefully. Until you feel confident, don’t add your signature.


In conclusion, an agency agreement template is a powerful tool used to create a legal agreement between the principal and the agent. Commonly, an agency comes into existence through agreement, operations of law, or ratification. This agreement explains different characteristics that exist between the principal and the agent.

Faqs (Frequently Asked Questions)

What is the maximum length of time that you can specify into an agency agreement?

Usually, there is no maximum length of time because the agency gets automatically renewed when the end date is reached. However, it depends on the nature and industry of the agency. It would be recommended to define a relatively short term for your first contract.

In what circumstances an agency agreement can be terminated?

An agency agreement can be terminated in the following situations;

1- When a principal or agent violates the conditions of the agreement.
2- Either of the party provides written notice to another party on the basis of the agreed notice period.
3- As a result of the work relevant to the contract, an agent or principal becomes bankrupt or insolvent.

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