N.C. Requires Certified Statements on Bid Rigging:

A “demand to produce information” has been issued by the North Carolina Department of Insurance in an effort to closely scrutinize the records and practices of more than 5,000 insurance companies and brokers licensed by the state. Insurance Commissioner Jim Long issued letters and surveys Oct. 28 giving everyone seven days to verify that the company has not participated in bid rigging. This demand is to reveal: 1) persons who have solicited, sold or negotiated insurance; 2) persons who have participated in bid rigging; 3) copies of the bids, quotes, applications and policies relating to such bid rigging; and 4) all information regarding how the respondent became aware of this information. If an insurance company or broker is not aware of bid rigging or illegal practices, it is still required to submit a notarized letter to the North Carolina Department of Insurance certifying that it has made a full and comprehensive inquiry and did not find anything to substantiate such a practice. Long was reacting to New York Attorney General Elliot Spitzer’s investigation into brokers and insurers, which did not specifically find problems in North Carolina. But, after carefully reviewing the available facts, Long launched an investigation in North Carolina. “When the investigation in New York was announced, many national entities (includingInsurance Journal Southeast) called our office for comments. “It has taken us the better part of two weeks to get enough facts straight in this case to determine how this may apply in North Carolina. While we have received no complaints of bid rigging here, I feel we should survey companies and brokers doing business in North Carolina. That will give us a starting point at which to begin a local investigation.” Long’s request requires companies receiving the “demand to produce information,” to respond and provide information about bid rigging, participation in any questionable arrangement and defines bid rigging. It requires the recipient to list, state and identify in detail any and all information relating to any bid rigging to which the recipient is aware and if such instances, to provide information about the instance. Anyone receiving the survey that is not aware of bid rigging is required to return a signed, notarized form from the president or CEO of the company.

Topics North Carolina