Case Details

Year Initiated/Committed


Year Resolved


Settlement Amount

$153 million

Lead State


Participating States



Zurich Financial Services; Zurich Holding Company of America, Inc.; Zurich American Insurance Company

Case Description

The settling states alleged that Zurich was a full participant in a scheme to fix insurance prices in the excess casualty area. For example, Marsh & McLennan Company sought phony bids from a Zurich underwriter for an insurance contract that was being steered to one of Zurich’s competitors, AIG. Zurich complied with the request and sent Marsh a non-competitive bid to be used to deceive Marsh’s client. The assurance of discontinuance also details Zurich’s use of improper “finite reinsurance” to bolster both its own financial results and those of its clients. For example, Zurich entered into a 1998 agreement with insurer MBIA, Inc. to provide risk-free “reinsurance” for a known $70 million loss. In exchange, Zurich received a separate risk-free insurance contract that returned the “reinsurance” payment to Zurich with a profit. Zurich apologized for its actions and agreed to pay $88 million to Zurich policyholders harmed by bid-rigging activities. In addition, Zurich will pay penalties of $39 million to New York and $13 million each to Connecticut and Illinois. This settlement also had the effect of increasing by $29.9 million the recovery consumers will receive as part of a separate multi-state settlement (See Texas v. Zurich)