Acordia Keeping Contingent Fees
Bucking a trend among the largest insurance brokerage firms, Acordia said it intends to continue accepting contingent commissions despite being sued over the practice by the West Virginia attorney general.
“We believe contingent commissions, properly administered, are not inconsistent with the responsibility of our brokers to their customers,” said Ellen Sievert, director of communications for the Chicago-based firm. “At this time, Acordia will continue to accept contingent commissions, subject to our processes and procedures for customer disclosures, which are based on a recommended model by the National Association of Insurance Commissioners.”
Last week, West Virginia Attorney General Darrell McGraw announced a suit against Acordia–a subsidiary of San Francisco-based financial services company Wells Fargo–accusing the broker of hiding the payment of contingency fees it received from insurers.
Mr. McGraw alleges the payments “were unfair and deceptive and resulted in less competition for insurance,” which in turn drove up the cost of coverage. His office said the evidence is similar in nature to that included with complaints by New York Attorney General Eliot Spitzer against other insurance brokers.
“The world's largest insurance brokers already have sworn off secret payments. I expect Acordia to be next,” Mr. McGraw added before Acordia's announcement.
The West Virginia Attorney General's Office did not have an immediate comment on Acordia's statement.
Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader
Your access to unlimited PropertyCasualty360 content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Breaking insurance news and analysis, on-site and via our newsletters and custom alerts
- Weekly Insurance Speak podcast featuring exclusive interviews with industry leaders
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical converage of the employee benefits and financial advisory markets on our other ALM sites, BenefitsPRO and ThinkAdvisor
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
