Last month's announcement that Arthur J. Gallagher will be allowed to collect contingent commissions once again starting on Oct. 1 has opened old wounds in the debate over the controversial producer compensation system, with a top broker and representatives of corporate and individual insurance buyers blasting the move.
Two of the nation's biggest brokers–Marsh and Aon–appeared to endorse an eventual return to the contingent compensation scheme, which both agreed to give up after a New York State investigation by then attorney general Eliot Spitzer turned up evidence the lucrative commissions were being abused as kickbacks for rigging bids and steering commercial clients to insurers.
While regulators had four major brokers agree to forego the contingency commissions, smaller intermediaries faced no such restrictions.
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