Company payments to employee benefit insurance brokers has become a focus of the Attorney General of New York, as his investigation expands to include subpoenae to Aetna, Cigna, MetLife and Hartford Life, according to the New York Times. "Contingency payments" reward commercial insurance brokers for achieving sales goals, but not all brokers disclose details of the payments to their customers. Several major brokers received subpoenae this spring as part of A.G. Eliot Spitzer's investigation. "Spitzer Inquiry Expands to Employee-Benefit Insurers" (New York Times, June 12, 2004).
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A related story mentioning similar inquiries by California Attorney General John Garamendi and indicating that the inquiry was prompted by the nonprofit Washington Legal Foundation was in the June 11 Times: "3 Insurers Say New York State Is Investigating Fees to Brokers" (New York Times, June 11, 2004).
A May 2004 backgrounder by the Insurance Information Institute (III) is available at: "Contingent Compensation and Service Agreements Between Insurance Brokers and Insurers"
Posted by dougsimpson at June 12, 2004 06:20 AM | TrackBack