DCBS Media Release
October 20, 2004
State to investigate charges of insurance bid-rigging, relating practices
SALEM – Oregon companies concerned that they may have been victims of bid-rigging and related practices by insurance brokers should contact the Oregon Department of Consumer & Business Services. DCBS is joining insurance regulators in other states to look into allegations that have led to recently-announced criminal charges and related civil investigations into bid-rigging, price-fixing, and payoffs involving insurance brokers and insurance companies.
Among other issues, regulators are investigating charges that insurance brokers steered business to favored insurance companies through use of false bids, in order to take advantage of contingent commissions paid by those companies. If confirmed, these practices may have resulted in increased insurance costs for businesses and individuals.
"We need to hear from any Oregon company that thinks that it may have been the victim of bid-rigging or similar practices by an insurance broker," DCBS Director Cory Streisinger said. "We'll be working with the Oregon Department of Justice to identify and take appropriate action against any brokers or insurers in this state who may have broken the law."
Companies that believe they may have been victimized should contact Cece Newell at the DCBS Insurance Division, 503-947-7203 or firstname.lastname@example.org.
"We've been concerned about issues with broker commissions for some time," DCBS Insurance Division Administrator Joel Ario said. "In fact, the Insurance Division currently has draft rules in circulation that would increase disclosure requirements to make certain that businesses and consumers are fully informed of how their broker is compensated and any conflicts of interest that may exist. We need to ensure that when insurance purchasers work with a broker, they can be confident that the broker is serving their best interests. We'll be reviewing those rules now to see if they need to be strengthened even further."
The draft rules are available for review on the Web. A public hearing on the rules will be held December 7 at 1:30 p.m. in conference room 260 of the Labor & Industries Building, 350 Winter Street NE in Salem. Written comments may be addressed to the Administrative Rules Unit in the Insurance Division, P.O. Box 14480 Salem, 97309-0405.