Know Competition, No Monopoly
No Competition, Know Monopoly

Columbus, Ohio, March 13, 2013:  The Sherman Antitrust Act was authored by Senator John Sherman (Ohio 1823 – 1900) and remains a landmark federal statute on competition.  This legislation (1890) authorized the federal government to break up organizations that restrain competition by opposing monopolies.  The law prohibits any contract, conspiracy or combination of business interests in restraint of foreign or interstate trade.

Every business has the right to compete, including those in the insurance industry.  The McCarran-Ferguson Act exempts the ‘business of insurance’ from certain federal antitrust provisions, but the exemption is only for the ‘business of insurance,’ and not for the ‘business of insurance companies.’  The ‘business of insurance’ includes only those activities that transfer or spread a policyholder’s risk, are an integral part of the policy relationship between the insurer and insured, and are limited to entities within the insurance industry.  All other activities of insurance companies, producers, and other industry participants remain subject to federal antitrust laws, as well as state insurance and antitrust regulation.

Consistent with the Sherman Antitrust Act, which protects competition in the marketplace; Demotech, Inc. works hard to assist every financially stable insurer offer its products through each producer it has duly appointed and to every consumer who wishes to purchase them.  During 2013, watch the national insurance trade press to read our opinion on a variety of perspectives.  Our initial advertisement can be viewed here.

About Demotech, Inc.

Demotech, Inc. is a financial analysis firm specializing in evaluating the financial stability of regional and specialty insurers.  Since 1985, Demotech has served the insurance industry by assigning accurate, reliable and proven Financial Stability Ratings® (FSRs) for Property & Casualty insurers and Title underwriters.  FSRs are a leading indicator of financial stability, providing an objective baseline of the future solvency of an insurer.  Demotech’s philosophy is to review and evaluate insurers based on their area of focus and execution of their business model rather than solely on financial size.  This philosophy was the catalyst for the Demotech Company Classification System, which was published in Insurance Journal, in order to stratify and categorize insurers into operational categories.  Visit for more information.

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