Skip Ribbon Commands
Skip to main content

Big "I" Files Amicus Brief on Zurich Settlement in Federal Lawsuit



Association Supports Transparency but Opposes Burdensome Mandates by Companies


ALEXANDRIA, Va., Sept. 25, 2006—The Independent Insurance Agents & Brokers of America (Big “I”) filed an amicus curiae brief in opposition to part of the proposed class settlement with Zurich in the United States District Court for the District of New Jersey.


“The Big ‘I’ supports transparency in insurance transactions, but is opposed to the portion of the settlement that would require independent insurance agents and brokers to implement for Zurich its obligation under the settlement to provide to insureds a form describing the company’s practices in compensating agents and brokers,” says Big “I” President Alex Soto, also president of Miami, Fla. based InSource, Inc.  “The brief also explains our strong support for incentive compensation and opposition to any prohibition on the payment of legal incentive compensation to agents and brokers.”


“Zurich should have the responsibility to provide to insureds any disclosure form it is obligated by law or otherwise chooses to provide about how it compensates agents and brokers,” says Big “I” CEO Robert A. Rusbuldt. “Agents and brokers should continue to have the latitude to customize their interactions to the specific requests and needs of customers.” 


By having agents facilitate communication of complex information about insurance transactions in a comprehensive way, it will be meaningful to the consumer, so that information about agents’ and brokers’ compensation arrangements is in the context of the overall cost, coverage, and service being considered. Because there are many components that determine the price of a policy, singling out disclosure of agent and broker compensation does not provide the consumer with sufficient transparency regarding the cost of the insurance transaction, Soto explained. 


“If other carriers follow the Zurich settlement approach of requiring agents and brokers to implement carrier compensation disclosures, the multitude of forms will exacerbate consumer confusion significantly, and create inefficiencies in independent agencies,” says Rusbuldt. This will be magnified even further for complex coverage involving layers of coverage from different carriers. In effect, customers will then be inundated and overwhelmed with varying disclosures, which will be impossible to compare and understand, leading them to ignore the disclosures altogether.


“If disclosures about compensation or any other aspect of insurance transactions are not easily understood by customers or are ignored, the transparency intended to promote greater consumer understanding of insurance transactions and costs would be entirely frustrated,” says Debra L. Perkins, Big “I” EVP and general counsel. 


Perkins notes that greater efficiency and effectiveness in monitoring compliance with the disclosure obligation will be achieved by having it implemented by the company. It also will allow regulators and the Court to most easily monitor compliance and address noncompliance since many brokers and agents who sell Zurich’s products around the country may not be subject to the Court’s jurisdiction.


“In addition, none of the measures in this settlement agreement pending before the Court, or any of the other settlements between carriers and regulators that are currently public, have yet addressed compensation transparency for consumers when they purchase insurance from captive agents or directly from insurance companies,” says Soto. 


The Big “I” also points out in the brief that it opposes the bar on Zurich’s payment of incentive compensation to agents and brokers in the future if 65% of the insurance companies in the marketplace do not pay incentive compensation for a product, line or segment of business.  “This limitation, if put in place, will harm consumers by making it more difficult for some Main Street agents to remain in business, which will decrease competition and lead to higher prices, especially in rural and underserved markets where these agencies are a primary channel for the distribution of insurance, “ added Rusbuldt. The brief notes that ultimately it is not for state Attorneys General who created the 65% threshold to determine whether carriers should be permitted to offer legal incentive compensation to agents and brokers or how it should be disclosed to consumers.


All settlement negotiations between carriers, regulators and Attorneys General, have been conducted privately and without the Big “I” being permitted to directly voice its concerns about certain terms.  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. To read the complete brief, please visit


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:






​127 South Peyton Street
Alexandria VA 22314
​phone: 800.221.7917
fax: 703.683.7556

Follow Us!

​Empowering Trusted Choice®
Independent Insurance Agents.