Insurance broker Aon Corp. reported that the five government agencies to its 2005 settlement have agreed to an amendment that will permit companies it acquires to continue to accept contingent commissions on existing business for three years following their acquisition by Aon.
Aon said it was at a competitive disadvantage because of the restrictions it was under. “For the last three years, brokers that have not introduced such reforms have had an unfair advantage in bidding to acquire other brokers, because they could assume a continued stream of contingent commissions from the acquired company, whereas Aon could not,” said David Prosperi, vice president of global public relations. “This had the perverse result of favoring brokers which still accept contingents and are not transparent to their clients.”
The parties to Aon’s 2005 agreement are the attorneys general of New York, Illinois and Connecticut, and the insurance departments of New York and Illinois.