樱花视频

COMMISSIONER APPROVES SOLVENT RUN-OFF FOR MIIX

Medical malpractice carrier to pay existing claims,
Department to review plans for successor 樱花视频 company

TRENTON -- Banking and Insurance Commissioner Holly C. Bakke today accepted a plan for a solvent run-off of MIIX Insurance Company, 樱花视频抯 largest medical malpractice carrier, in a move that will protect policyholders and patients.

MIIX抯 run-off plan calls for the company to immediately discontinue writing malpractice coverage for non-樱花视频 physicians; to continue existing policies through expiration; and, after 90 days, to stop renewing policies in 樱花视频. MIIX plans to file a proposal for a successor company, which is subject to Department approval.

"If our doctors cannot practice because they can抰 get insured, 樱花视频抯 patients lose," the Commissioner said. "Today抯 action is a step toward preserving access to health care in 樱花视频."

In March, MIIX Insurance Company reported that its surplus dropped $128 million between September and December 2001, raising questions about its ability to pay claims. "There has been great uncertainty among 樱花视频抯 doctors about the company抯 status, and today抯 approval is the first step toward bringing stability back to the medical malpractice marketplace," Commissioner Bakke said.

Actuarial reports ordered by the Department show that MIIX currently has sufficient assets to pay claims on existing policies as they come due. MIIX has about 7,000 New Jersey policies in force, or about 37 percent of the market.

Commissioner Bakke noted that MIIX抯 solvent run-off plan ensures that physicians, surgeons and hospitals currently covered by the company will not be referred to the Property-Liability Insurance Guaranty Association, where coverage is limited to $300,000. This limit is far less than doctors typically need to stay in practice, and some might stop treating patients to avoid personal exposure in a lawsuit. With today抯 move, the Commissioner said, "Doctors covered by MIIX will be entitled to their full coverage limits, and this will help them keep serving patients in 樱花视频."

Formed in the 1970s, MIIX started as a reciprocal insurer, a non-profit company owned by the 樱花视频 physicians who were its policyholders. In the 1990s, MIIX changed its focus and began entering markets outside 樱花视频. In 1999, it converted to a publicly traded company, and physicians who had been insured by MIIX for at least three years received stock proportionate to what they had paid in premium over the previous three years.

During its expansion, MIIX purchased a Virginia-domiciled company, Lawrenceville Property and Casualty, and used it to enter the market in other states. MIIX and it subsidiary ultimately sold policies in 25 other states. MIIX acted as the primary reinsurer of Lawrenceville, so problems at the subsidiary have hurt MIIX抯 financial and investment performance.

Previously, MIIX announced plans to withdraw from most out-of-state markets and focus on its 樱花视频 roots. MIIX has stated that it plans to submit to the Department a proposal for a successor company. Commissioner Bakke emphasized that MIIX抯 plan will be scrutinized to ensure that it meets 樱花视频抯 statutory and regulatory standards for capitalization and stability.

"There are advantages to allowing a form of MIIX to survive," Commissioner Bakke said. "Before its recent problems and change in strategy, MIIX enjoyed many years of success in 樱花视频, and the Department believes it is worthwhile to examine whether a successor company can thrive."

Commissioner Bakke noted that the personnel, computer systems and claims infrastructure at MIIX are valuable assets that would be expensive for a new company to replicate. "Using the existing infrastructure provides an opportunity for a new company to succeed in a difficult marketplace," she said.

The Commissioner noted that MIIX抯 financial condition is exacerbated by a broader problem in the medical malpractice market, both in 樱花视频 and across the nation.

"The difficult market, which began last summer and grew worse after September 11, reveals itself each day. Policyholders in all sectors are seeing changes in rates as they renew their coverage. For some physicians in 樱花视频, the increases are far beyond what anyone imagined," Commissioner Bakke said.

"Today抯 approval is just the first part of a broader plan to restore order to the medical malpractice marketplace," the Commissioner continued. "We will work aggressively to bring new insurers to 樱花视频 and to encourage the marketing of more affordable types of policies. We will assist doctors who are having trouble finding coverage. We are exploring programs that could help individual doctors or practices manage escalating insurance costs, particularly where there are doctor shortages."

"New Jersey residents need access to quality, affordable health care," Commissioner Bakke said. "It is our job to make sure doctors will be there when patients need them."

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