Unlike American International Group, Zurich, ACE and other insurers that have settled similar charges, Liberty Mutual Insurance Group decided to fight allegations of anti-competitive practices that have been brought against it by the attorneys general of New York and Connecticut.
The Boston-based insurer is insisting that charges regarding improper commissions and bid-rigging are untrue and overblown and says it is willing to go to court to defend itself and its practices rather than settle with the two states.
After two years of negotiations, Liberty Mutual said it reached a resolution and believes the states’ settlement demands have been excessive.
The insurer took its stand following the filing of complaints by the offices of New York Attorney General Eliot Spitzer and Connecticut Attorney General Richard Blumenthal involving bid-rigging and commission payments.
The complaints describe alleged cooperation of Liberty Mutual employees in a bid-rigging scheme in which the employees provided large insurance broker Marsh with so-called “B” quotes for excess casualty accounts. The quotes were intentionally less favorable than other insurers’ quotes.
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