PIA Western Alliance Releases Statement on New York Insurance Scandal

October 22, 2004

Like most insurance associations, the PIA Western Alliance—consisting of four affiliate chapters covering eight western states—is in shock over the news of a lawsuit filed against the nation’s largest insurance broker, Marsh, Inc. The New York State Attorney General has accused them and other industry insurers of bid-rigging, price-fixing and kick-back schemes.

PIA Western Alliance Executive Director, Clark Sitzes says this goes against the PIA’s commitment to a free and open market. “Criminal behavior that damages the free market must be dealt with accordingly and the offenders brought to justice. And the suit filed in New York State tells us that the state systems designed to protect the consumer are working.”

The news of the lawsuit and alleged criminal activity by Marsh and other industry giants has critics stating that more needs to be done at the federal level to protect the consumer. Sitzes says the PIA Western Alliance belief is that the job can be done better by state regulators. “The officials who regulate insurance in the states represented by the PIA Western Alliance do a very good job. We have the utmost confidence in their ability to ferret out schemes such as those alleged to have happened in New York State and deal with them quickly and effectively. Their efforts protect the consumer, companies and the independent agent system.”

Sitzes says it is important for cooler heads to prevail during this type of crisis. “Anyone found to be breaking the law must be identified and made to explain their actions to the legal system. What we don’t want to do is overreact to accusations such as these and do permanent damage to the market place with unnecessary and unneeded regulation. That can cause irreparable harm to the consumer and to the companies offering them insurance coverage and to the agents and brokers who deliver it.”

The PIA Western Alliance represents independent insurance agents in Alaska, Arizona, California, Idaho, Montana, Nevada, New Mexico, Oregon and Washington.

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