California Investingating Insurance Brokers Kick-Backs
California Insurance Commissioner John Garamendi is cracking down on what he says is conflict of interest among insurance brokers.
Wednesday, October 20, 2004
Garamendi told reporters that recent investigations in New York State have raised the possibility that insurance brokers nationwide are steering clients to major insurance companies in return for large “contingent commissions,” all without regard to what’s best for the customer. Garamendi says California policyholders should ask themselves if they’ve been cheated. CUT: Garamendi10 :10 Garamendi says he’s issuing new regulations requiring brokers to reveal all compensation they receive from insurance companies – before a sale to a customer is completed. He says all lines of insurance are involved as are some of the nation’s largest insurance companies. And Garamendi says he’ll file civil lawsuits next week against brokers who did not fulfill their fiduciary duty by putting clients first. SOC