Zurich Financial Services said today it will book a $325 million first-quarter charge to cover the cost of settling allegations of bid-rigging and other broker compensation wrongdoing with 13 states.
The company also this morning announced an agreement with New York, Connecticut and Illinois state officials that will see it pay $153 million for restitution to excess casualty policyholders as well as penalties.
In addition, the agreement prohibits Zurich from paying contingent commissions on excess casualty business in the U.S. through 2008 and establishes a mechanism whereby the company would stop paying contingent commissions on other lines of business if 65 percent of the U.S. market for a particular line of business is not paying such commissions.
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