The investigations begun by Eliot Spitzer of broker-insurer business practices have not only spread from property and casualty insurance to other lines, but to other states, and now it appears there may be international repercussions as well.
The investigations and subpeonae appear to be increasing on a daily basis, with each morning beginning with an annoucement of additional targets. Employee benefits insurers and brokers are now coming under scrutiny, while the number of P&C carriers facing subpoenae has increased again today with St. Paul/Travelers the latest subject. Chubb is also under investigation, while also facing allegations concerning their relationship with their auditors, Ernst and Young.
Expect this to continue, as Attorneys General throughout the country seek to ensure their consituents are protected, simultaneously demonstrating their diligence. This last comment may be viewed as cynical, but undoubtedly any regulator worthy of the post will want to be sure they are viewed as aggressively pursuing this hot issue.
Undoubtedly the ramifications will continue to be felt – latest rumors have the Mercer Consulting entity splitting off from parent Marsh…
Notably, the highly publicized nature of the charges has drawn the attention of federal regulators, with the recent release of a GAO report on federal regulation of financial services. Included in the report is a discussion of the potential for changes in the role of the feds in insurance regulation.
This issue will not go away anytime soon.
Nov
10
