Med-Mal Carrier To Start In N.J.
By Mark E. Ruquet
NU Online News Service, Sept. 16, 11:12 a.m. EST?A program administrator said it has obtained clearance from regulators to create a physician owned carrier providing coverage in New Jersey's difficult medical mal-practice insurance market.
Woodbridge, N.J.-based National Insurance Programs said it received approval from the state's Department of Banking and Insurance to open a reciprocal exchange insurance company and is looking for physicians and surgeons to join the Conventus Inter-Insurance Exchange.
NIP said Conventus would be a "physician owned and governed medical professional liability insurance company," and is currently looking for members to join its ranks. The company said it needs 200 members to sign-up between now and Nov. 15 in order to commence operations.
Conventus would be a non-profit company owned by participating physicians. NIP would be the attorney-in-fact responsible for the daily maintenance of the company.
Richard Augustyn, chief executive officer of NIP, said the new company must meet minimal capitalization of $2 million surplus before the state will consider issuing a license. However, he said he expected the new company to start with $5 million in surplus.
Physicians initially signing up for coverage would be offered a two-year policy, guaranteed coverage, and locked-in capital contribution. The venture is non-profit, the statement said.
If the state grants approval, policies would begin to be issued no later than Jan. 1, 2003.
The plan, Mr. Augustyn said, would be offered to all primary care physicians and specialists only in New Jersey, and those "who have experienced claims while providing quality care."
New Jersey's physicians have been facing increased difficulty obtaining malpractice coverage, as carriers have left the market or more than doubled prices.
NIP said some physicians have reacted by shutting their doors to patients because they can no longer afford insurance.
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