Zurich settles bid-rigging charge

Zurich Financial Services has agreed to pay $153m (£88m) to settle insurance bid-rigging charges by three US states.

The agreements with New York, Illinois and Connecticut bring to about $325m in such settlements it has made in the US.

Zurich was accused of conspiring with other insurers to fix prices for certain policies. It has apologised, but not admitted to breaking any laws.

It has agreed to stop paying special commissions to encourage brokers to steer business its way.

New York state Attorney General Eliot Spitzer said Zurich had also pledged to adopt “a series of sweeping reforms”.

“Zurich’s willingness to acknowledge problems, adopt reforms and provide appropriate compensation to customers will help the company move forward and will help promote full and fair competition in the insurance industry,” said Mr Spitzer.

Zurich’s settlement comes less than two months after the world’s biggest insurer American International Group paid a record $1.64bn agreement on many of the same charges.

Richard Blumenthal, Connecticut Attorney General, said investigations against other insurance firms were continuing.

“We’re out to obliterate a culture of corruption,” he said.