The Antitrust Division of the Department of Justice has concluded that competition in the insurance market is likely to be enhanced, rather than harmed, by a proposed consortium of commercial insurers who will pool their resources to offer large commercial insurance policies worth a minimum of $250 million. Acting Assistant Attorney General Deborah Garza, who is head of the Antitrust Division, stated that Concepta Services LLC, as the proposed consortium will be called, “may provide a competitive new option for those looking to purchase these types of policies.” Membership in Concepta, which would be owned and was proposed by Ivy Capital Group LLC, would be restricted to insurers that do not have the funds to offer such policies individually. According to Ivy, the number of insurers able to respond to requests for proposals from companies seeking property insurance coverage that approaches or exceeds $250 million is “extremely limited.” Concepta aims to become a meaningful competitive option in this arena by pooling the resources of members that focus on different niche submarkets and that do not have the funds to offer such policies on their own.
Following its antitrust review of the proposed consortium, the DOJ concluded that Concepta appears to fall within the safety zone established by the competitor collaboration guidelines adopted by the DOJ and the Federal Trade Commission because its prospective members presently had minimal involvement in the sale of large commercial policies. Accordingly, the DOJ informed Ivy that it has no present intention to challenge the formation or activities of Concepta.
