Connecticut Attorney General Richard Blumenthal filed an antitrust lawsuit against Guy Carpenter & Company, LLC, one of the world’s largest reinsurance brokers for anticompetitive practices.  The complaint alleges that Guy Carpenter illegally inflated insurance costs for insurance companies and consumers nationwide.

In a press release, Blumenthal said, “Guy Carpenter served as ringleader in choreographing the reinsurance market to fix prices, stifle competitors and collect excessive profits at the expense of an entire industry.  My antitrust investigation has revealed an industry plagued by pervasive anticompetitive and anti-consumer practices.  Guy Carpenter’s schemes were enabled by a shifting coterie of more than 20 coconspirators – reinsurers willing to play Guy Carpenter’s game of deceit, and damage consumers."

The complaint asserts that Guy Carpenter conspired with numerous reinsurers to exploit its position as a dominant reinsurance broker, that it fixed prices, shut out competitors, manipulated the markets and substantially increased profits in the reinsurance market.

Although not named as defendants, Blumenthal mentions nine others as coconspirators including, Excess Reinsurance Co. and The Hartford Steam Boiler Inspection and Insurance Co.  He said that the investigation is ongoing and further action is anticipated.

More on this story in the October Mealey’s Litigation Report:  Insurance Broker Liability.