NEW YORK -- ACE Ltd. yesterday became the latest insurance company to unveil changes in its business practices in response to the industry probe launched by New York's attorney general.
The Bermuda-based firm also disclosed that it had fired two employees, including ACE Casualty Risk president Geoffrey Gregory, and suspended three others.
The other employee who was dismissed was Patricia Abrams, who last month entered a guilty plea to criminal misdemeanor charges of bid-rigging. Abrams, who is believed to be cooperating with New York investigators, was an assistant vice president in ACE's excess casualty unit.
The three suspended employees "worked in ACE Casualty Risk on a team within the excess casualty unit that did business principally with Marsh Global Broking," ACE said.
It was a reference to a unit of New York-based insurance broker Marsh & McLennan Cos. that is at the center of a probe launched Oct. 14 by New York Attorney General Eliot Spitzer. Spitzer has accused Marsh & McLennan of bid rigging, price fixing, and heavy use of incentive fees, sometimes called marketing service agreements or placement service agreements. The practices resulted in businesses being forced to pay more than necessary for property and casualty policies, Spitzer contends.
ACE is among several insurance companies mentioned in Spitzer's suit, but it has not been charged with any wrongdoing. ACE said it would adopt guidelines and procedures that would "avoid real or any appearance of conflicts of interest."
Also yesterday, a Marsh & McLennan spokeswoman said that the firm had dismissed four executives after an internal investigation into Spitzer's allegations.