AIG workers compensation settlement disputed by Liberty Mutual units
CHICAGO—Subsidiaries of Boston-based Liberty Mutual Group Inc. have asked a federal judge to reverse a $450 million settlement paid by American International Group Inc. for its alleged underreporting of workers compensation premiums.
In a June 12 filing in the 7th U.S. Circuit Court of Appeals, Safeco Insurance Co. and Ohio Casualty Insurance Co. say the court erred in approving the settlement from New York-based AIG because they believe it was the “result of collusion and an improper reverse auction” between AIG and insurers that AIG had accused of premium underreporting.
In particular, the brief claims the settlement unfairly benefited ACE INA Holdings Inc., The Hartford Financial Services Group Inc., The Travelers Indemnity Co. and Companion Property & Casualty Insurance Co.