California Attorney General Bill Lockyer’s office continues a “preliminary” look at insurance brokerage practices, while state insurance regulators announced a plan to address any problems they uncover.[@@]
In addition to California, New York Attorney General Eliot Spitzer and Connecticut Attorney General Richard Blumenthal are conducting their own inquiries into the matter.
In the California attorney general’s office, an internal team of lawyers is looking at charges involving broker payments from insurance companies and bid rigging, says Tom Dresslar, a spokesman for Lockyer’s office. The team includes lawyers in antitrust, securities fraud and the special crimes unit as well as the section representative for the state insurance commissioner.
The attorney general is working with California Insurance Commissioner John Garamendi, he adds.
“It is premature to say that there is a formal investigation at this point. It is at a preliminary stage. We want to see what role, if any, we will play,” says Dresslar.
A decision should be made fairly soon, he adds. “We do not want to tarry too long.”
Diane Koken, president of the National Association of Insurance Commissioners, Kansas City, Mo., detailed plans worked out by commissioners to address any brokerage problems that its planned investigation bring to light.
Koken also defends the work of state insurance regulators against critics who have said federal regulation of insurance is needed.
“Federal oversight would not have caught [alleged abuses] faster than the states,” Koken says.