ABSTRACT
This chapter focuses on some of the more blatant abuses of the public trust by the commercial insurance industry. The purpose of the cartel was to protect high profit margins by sharing information, limiting and standardizing products, and fixing prices. In 1988, the House Judiciary Committee Subcommittee on Economic and Commercial Law approved a bill limiting the insurance industry exemption from antimonopoly regulation. The commercial insurance industry is exempt from federal antimonopoly regulations. This legalizes conspiracies to fix prices, carve up territories, and standardize product offerings. The commercial insurance industry grew and prospered during the century in large part because it was organized as a legal cartel. The path to legal conspiracy was further cleared in midcentury by McCarran-Ferguson. Federal legislation to abolish or modify McCarran-Ferguson has been floated, invariably faced with massive lobbying activity by the insurance industry attempting to block it.
