Posted on 29 Apr 2011
Liberty Mutual Group today announced that its Ohio Casualty and Safeco units filed their opposition papers to a proposed settlement of the class action suit pending against American International Group for underreporting workers compensation premium.
According to Liberty Mutual, "the settlement proposed by ACE, Auto-Owners, Companion, FirstComp, Hartford, Technology and Travelers is in AIG’s self-interest and the interest of several intervenors, but it is detrimental to the class of over 500 insurance companies victimized by AIG’s admitted wrongdoing."
Liberty Mutual alleges that the currently known extent of AIG’s underreporting is $6.1 billion, nearly three times the amount that the settlement is predicated upon.. The Boston-based insurer says that conservatively the actual damage to the insurance industry caused by AIG exceeds $1.5 billion.
The two Liberty Mutual Group units stepped forward two years ago calling for AIG to adequately address what they deem as a systemic practice of underreporting workers compensation premium.
Liberty Mutual says it's confident that the Court will see the proposed settlement as the byproduct of a collusive process between AIG and hopelessly conflicted parties.