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Aon Forecasts 9.8 Percent Average Increase in Global Medical Plan Costs for 2026

"North America and Asia-Pacific (APAC) are the only regions where Aon projects an increase in medical trend rates, reaching 9.3 percent and 11.3 percent respectively. In contrast, Aon's report shows that Europe is expected to see the largest decline, with rates dropping from 8.9 percent in 2025 to 8.2 percent in 2026."

Aon Defeats ERISA Class Action at Trial

"Plaintiffs alleged that Aon and Lowe's breached their fiduciary duties of loyalty and prudence under ERISA to the Plan by directing substantial Plan assets to Aon's proprietary investment products.... In rejecting Plaintiffs' argument that Aon breached its fiduciary duty because its proprietary fund did not generate as much growth as other investment options, Judge Bell noted that Plaintiffs' 'hindsight attacks' on Aon's alleged failure to consider alternative investments based on historical results were 'unpersuasive'[.] ' [Reetz v. Lowe's Companies, Inc.; Administrative Committee of Lowe"s Companies, Inc. and Aon Hewitt Investment Consulting, Inc., No. 18-075 (W.D.N.C. Oct. 12, 2021)]

Fourth Circuit Affirms Aon Hewitt Did Not Breach ERISA Fiduciary Duties in Cross-Selling Services and Managing Lowe's 401(k) Plan

"[T]he court found that Aon was not acting as an ERISA fiduciary when it engaged in cross-selling of additional services at the time that it was recommending that Lowe's restructure its retirement plan.... Second, the court found that Aon did not violate its ERISA fiduciary duty of loyalty by recommending that the plan adopt a streamlined investment menu which happened to play to its interest." [Reetz v. Aon Hewitt Investment Consulting Inc., No. 21-2267 (4th Cir., July 17, 2023)]

Text of Federal District Court Opinion: No Breach of Fiduciary Duty by Aon in Lowe's Class Action Suit (PDF)

120 pages. "[T]he Court finds that Aon did not breach its fiduciary duty as an investment advisor to the Plan in proposing and encouraging Lowe's to change the Plan's investment structure and menu of investment options nor did it violate ERISA in its efforts to 'cross-sell' its delegated fiduciary services, which Lowe's -- a large, sophisticated corporation -- independently decided to engage. Also, the Court concludes that although the Aon Growth Fund that Aon selected as the Plan's delegated fiduciary investment manager did not generate as much investment gains as other investment options that, in hindsight, would have fared better, it did not breach its fiduciary duty to the Plan in selecting and maintaining the Aon Growth Fund as the primary actively managed 'equity' investment option in the Plan." [Reetz v. Lowe's Companies, Inc.; Administrative Committee of Lowe's Companies, Inc. and Aon Hewitt Investment Consulting, Inc., No. 18-075 (W.D.N.C. Oct. 12, 2021)]

Aon and Willis Towers Watson Mutually Agree to Terminate Combination Agreement

"Aon plc and Willis Towers Watson announced today that the firms have agreed to terminate their business combination agreement and end litigation with the U.S. Department of Justice (DOJ). The proposed combination was first announced on March 9, 2020.... In connection with the termination of the business combination agreement, Aon will pay the $1 billion termination fee to Willis Towers Watson, Willis Towers Watson's proposed scheme of arrangement has now lapsed, and both organizations will move forward independently."

Justice Department Sues to Block Aon's Acquisition of Willis Towers Watson

"The merger between Aon and Willis Towers Watson would combine two of the 'Big Three' insurance brokers who, as alleged in the complaint, can offer global service, sophisticated data and analytics, and a breadth and depth of knowledge and expertise that other brokers do not offer. As alleged in the complaint, Aon and Wills Towers Watson operate 'in an oligopoly' and 'will have even more [leverage] when [the] Willis deal is closed.' If permitted to merge, Aon and Willis Towers Watson could use their increased leverage to raise prices and reduce the quality of products relied on by thousands of American businesses -- and their customers, employees, and retirees." [U.S. v. Aon and Willis Towers Watson, No. 21-1633 (D.D.C. complaint filed Jun. 16, 2021)]

Claims Against Astellas, Aon Move Forward in Untested CITs Lawsuit

"The plaintiffs allege that instead of acting in the exclusive best interest of participants, [Aon] ... acted in its own interest by causing the plan to invest in Aon's proprietary collective investment trusts (CITs) for Aon's benefit. The Astellas defendants are also accused of failing to use the plan's bargaining power to negotiate reasonable fees for investment management services." [Miller v. Astellas US LLC, No. 20-3882 (N.D. Ill. Apr. 13, 2021)]

Aon Hewitt Can't Escape Safeway's 401(k) Fee Lawsuit

"[The federal district judge] rejected Aon's argument that it didn't breach its fiduciary duty of prudence because it had in place a 'master consulting agreement' with Safeway that established Aon's 'robust process' in providing 'ongoing consulting and performance evaluation.' The terms of the agreement, standing alone, can't establish that Aon acted prudently, and the fact that an agreement exists doesn't prove it was followed, [the judge] said." [Terraza v. Safeway Inc., No. 16-3994 (N.D. Cal. Dec. 11, 2017)]

Aon Forecasts 10 Percent Average Increase in Medical Plan Costs for 2025 Globally

"This year's report projects Middle East and Africa (MEA) to have the highest trend rate of any region at 15.5 percent. Asia-Pacific (APAC) and North America will experience the highest year-over-year trend rate increases at 11.1 percent and 8.8 percent, respectively."

Aon Projects PRT Market Will Again Climb Above $40B in 2024

"Aon attributed the growing interest in PRT to three factors: funded status improvement, rising interest rates and increasing [PBGC] premiums.... However, newer entrants to the PRT market, backed by parent companies associated with private equity, have caused some stakeholders to ask for a closer review of the [DOL's] Interpretative Bulletin 95-1, which gives guidance on selecting the 'safest available' insurer for a PRT. "