Marsh & McLennan Companies will pay more than $83.5 million to settle a class-action suit filed by those who were clients of the firm's insurance brokerage arm while it engaged in alleged bid-rigging and steering of insurance contracts.
According to court filings, the settlement--filed in U.S. District Court of New Jersey in Newark, before Judge Garrett E. Brown Jr.--will award over 200,000 plaintiffs more than $69 million. In addition, MMC will pay more than $14.5 million in legal fees to the attorneys who represented the plaintiffs.
The settlement covers the period from August 1994 to September 2005. During that time, MMC's insurance brokerage firm--Marsh--was accused of engaging in bid-rigging, price-fixing and steering of commercial insurance contracts in return for kickbacks from insurers in the form of volume-based contingent commissions.
The brokerage firm settled the case with the New York Attorney General's Office in early 2005, paying a settlement of $850 million that was to go into a fund to be paid to clients harmed by the insurance brokerage's actions.
In 2004, as the allegations were coming to light, several lawsuits were filed against a number of insurance brokers, alleging collusion and racketeering. The actions were consolidated in 2005 in the New Jersey court.
According to the court filings, 218,216 notices were sent out to plaintiff class clients. Judge Brown said there were three plaintiff objectors to the settlement. He dismissed all three, ruling their objections were without merit.
A request for comment from an MMC representative was not returned.
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