Insurance Probe

As hurricane winds blew, 1,600 state owned or leased buildings suffered damage. Now, the state is investigating whether the company that arranged hurricane coverage, Marsh and McLennan, took $400,000 from the state for arranging the coverage and then got a kickback from the companies underwriting the policies.

Tom Gallagher, Florida Chief Financial Officer, says, “If they also got paid a commission from the companies, in my opinion, they owe us that money because they should have been getting us net deals, not commission deals.”

Marsh and McLennan is also under fire nationally for forcing insurers to kick back commissions. The primary victims in Florida, if there are any, are big corporations. Still, says Attorney Gen. Charlie Crist, who has subpoenaed company records, average Floridians end up being hurt and paying for the kickbacks.

“It’s costing the company who employs those people more money than that company can probably provide, less health care coverage to those employees,” says Crist.

Unlike the New York investigation, agents in Florida often work for the companies they represent and consumers know that they are being paid commissions. The agents say that there would be no way for them to inflate quotes to pay kickbacks.

Jeff Frady of the Florida Association of Insurance Agents says, "These agencies are doing all they can to produce the most competitive bid for that client because they know that if they don’t, probably someone else is working on that same bid and it's going to undercut them and the client is going to go with that agent."

The attorney general is still waiting for answers to his subpoenas.