Middle-men tend to get a bad press, in any market. The supplier sees extra revenue being drained away and the consumer resents any extra charges on their bill.

In the insurance industry, the brokers are the perceived bad guys, despite the fact that without them the whole process would descend into a shambles of paperwork and gobbledegook.

Little wonder then that there was such a public outcry recently when Marsh McLennan, the world's biggest broker, was accused by the New York Attorney General, Mr Eliot Spitzer, of bid-rigging, taking illegal payments and general wrongdoing.

Mr Spitzer had already attacked Merril Lynch for its investment banking and research practices before turning his attention to globally detested internet spammers, illegal trading by mutual funds and Wall Street analysts that he felt were issuing false reports to benefit their customers.

Mr Spitzer, dubbed the most powerful man on Wall Street, has already forced the resignation of Marsh McLennan's chief executive, Mr Jeffrey Greenberg. His major tactic is using negative publicity to cause share prices to plummet (Marsh's fell 14 per cent the day he made his announcement).

The issue for the Irish market is that Mr Spitzer linked the alleged bid-rigging to market service agreements (MSAs). MSAs, or contingent commissions, are a long-standing practice where insurance companies pay brokers extra commission for steering business their way.

Although MSAs are a perfectly legal and accepted practice, the bad publicity created by Mr Spitzer's announcement has led Marsh and its largest rival Willis to stop taking these commissions, and move to complete transparency for all their transactions - a move that will have a major impact on the market.

"Bid-rigging is illegal and corrupt and not accepted culturally within the business. No one would deny that," commented one leading industry source.

"The problem here is that these MSAs, which are an integral and acceptable part of how brokers do business, have now become a tainted currency.

"Previously they were widespread throughout the industry, especially amongst medium and larger brokers. In the light of this Spitzer business, four of the largest brokers in Ireland have stopped taking them: Coyle Hamilton Willis, Aeon, JLT and Marsh Ireland.

"These companies aren't just going to let the missing revenue disappear into the profitability of the insurance companies. The MSAs existed to cover certain costs. Who's going to pay for those costs now?

"Brokers are going to have to find some way of remodelling their business without the revenue from MSAs. Any which way you look at that, it's going to have a major impact," he said.

The costs that the MSAs covered included professional analysis; reports and surveys on the provisions of costs; helping the carriers evaluate the risk and the development of new technology and electronic trading.

The brokers also have to worry about the credit risk. After a specified period of weeks, any credit risk is transferred from the carrier to the broker. If the client defaults, the broker is liable.

These were all services provided by the brokers that benefited the insurance companies, and for which they were charged MSAs which were non-client specific . Most likely the brokers will now charge the insurance companies extra commission on individual deals.

To facilitate this, these companies will have to move towards total transparency. The difference from the old system will be that all these charges will be detailed on the invoice.

This may cause an imbalance in the market, according to the source.

"As it is, these four companies have moved to a transparent way of dealing with clients.

"Some will follow, but others, especially the smaller brokers, won't unless they are forced to by the Competition Authority or IFSRA [ the Irish Financial Services Regulatory Authority] because they may have had an over-reliance on non-client-specific charges and will be reluctant to see them go.

"But clients will probably prefer to deal with brokers where they know where every cent is going, so you could see a squeezing out of the smaller firms."

Whether this becomes a protracted struggle or a smooth transition will most likely depend on regulation. IFSRA is due to start its investigations at the start of next year.

"Plans to do consultations regarding contingent commissions will begin in January," said a spokesperson.

"We will be publishing all results and findings on our website. At the moment there is a code of conduct which states that any intermediary must act in the best interest of their clients.

"In the case of life assurance policies, all details must be disclosed, but for non-life policies, they simply have to work to the client's best advantage."

If IFSRA's findings call for the complete abolition of MSAs, it will cause major changes in the way carriers deal with brokers.

Whatever happens, it seems that the influence of Mr Spitzer will, once again, be far-reaching.