Marsh unit sued by Connecticut AG

Connecticut Attorney General Richard Blumenthal sued Guy Carpenter and Co., Marsh and McLennan Cos.’ reinsurance unit, on charges that the broker violated antitrust and unfair trade practices acts.
Mr. Blumenthal accused the New York-based Guy Carpenter of conspiring with reinsurers to fix prices, eliminate competition and substantially increase profits; he says the scheme increased prices for primary insurance companies and directly caused an increase in consumer costs, published reports said.
Marsh and McLennan, a New York-based financial advising and insurance company, buys Guy Carpenter’s reinsurance as backup coverage.
“The Connecticut Attorney General’s complaint is based on a fundamental misunderstanding of reinsurance facilities that have been in operation for the benefit of small- and mid-sized clients for as long as 50 years,” Guy Carpenter, the world’s second-largest reinsurance broker, said in a news release. “Simply put, there is no basis for the Attorney General’s lawsuit and we intend to defend ourselves vigorously.”
The lawsuit filed in state court seeks damages, restitution and civil penalties.