BIG “I” FILES REPLY BRIEF IN ZURICH SETTLEMENT CASE

Answers questions about filing of amicus curiae brief

ALEXANDRIA, Va., Oct. 23, 2006—The Independent Insurance Agents & Brokers of America, Inc. (Big “I”) filed a reply brief on October 20, 2006 refuting the opposition to its amicus curiae brief filed last month in New Jersey federal court. The class action lawsuit concerns the producer compensation and disclosure issue and related Zurich Settlement agreement.

The Big “I” amicus curiae brief focused on the burden imposed on agents and brokers by the Zurich Settlement agreement entered into in March 2006 mandating that agents and brokers provide insureds with the company’s compensation disclosure form. Opposition to the Big “I” brief was filed by the intervening Attorneys General who signed the Multi-State Settlement Agreement with Zurich, the plaintiffs and Zurich. The essence of the opposition was that the Big “I” amicus curiae brief was filed prematurely; none of the opposition questioned the credentials of the Big “I” to advise the Court regarding the impact that the Zurich Settlement will have on brokers and agents.

“The Big “I” amicus brief provides the Court with important information about the negative consequences consumers as well as insurance brokers and agents will experience if the Court approves the portion of the proposed Zurich Settlement requiring brokers and agents to provide their customers with Zurich’s Mandatory Disclosure Form,” says Big “I” President Alex Soto, also president of Miami, Fla. based InSource, Inc. “Imposition of this form on agents and brokers will inhibit agents and brokers’ communication with their customers and increase customer confusion regarding incentive compensation.”

“The intervening Attorneys General represented to the Court in August 2006 that they intend to seek court approval of the Zurich Settlement, which includes the requirement that brokers and agents provide their customers with the Mandatory Disclosure Statement,” says Big “I” CEO Robert A. Rusbuldt. “If it was timely for them to intervene in August for that purpose, our request to appear as amicus curiae is timely now.”

Contrary to suggestions in the opposition filed to the Big “I” amicus brief, the Big “I” does not oppose “pre-binding disclosure” of incentive compensation; rather, it opposes the proposed requirement that brokers and agents provide their customers with Zurich’s Mandatory Disclosure Form, explains Soto.  

“The Big “I” was not a party to the negotiations and had no opportunity to raise its concerns about the Mandatory Disclosure Form before the Zurich Settlement requiring it was executed,” Rusbuldt adds.

“By filing now, the Big “I” is giving the Settling Parties the opportunity to revise the Mandatory Disclosure Form provision voluntarily,” says Debra L. Perkins, Big “I” EVP and general counsel.

“Zurich represented to the Court that compensation disclosure was something that the state insurance regulators and Attorneys General that signed the Multi-State Settlement ‘required Zurich to undertake’ so the Big “I” believes that the Court’s order should reflect what Zurich acknowledged –that the obligation to deliver the Mandatory Disclosure Form to consumers belongs to Zurich, not to insurance brokers and agents,” explains Perkins.  

The Big “I” has worked tirelessly to ensure this issue is addressed in the same transparent manner in which all other aspects of insurance transactions should be handled.

“The Big “I” continues to support the latitude that agents and brokers should have to customize their interactions, including about compensation disclosures, to the specific requests and needs of their customers,” says Rusbuldt.

To read the complete reply brief, please visit www.independentagent.com.

Founded in 1896, the Big “I” is the nation’s oldest and largest national association of independent insurance agents and brokers, representing a network of more than 300,000 agents, brokers and their employees nationally. Its members are businesses that offer customers a choice of policies from a variety of insurance companies. Independent agents and brokers offer all lines of insurance—property, casualty, life and health—as well as employee benefit plans and retirement products. Web address:  www.independentagent.com.

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