N.J. Department
of Banking and Insurance Approved National Insurance Program's Plan
to Form a New Medical Professional Liability Exchange
September 12, 2003—The
New
Jersey Department of Banking and Insurance has approved National
Insurance Programs' (NIP) plan to form the Conventus Inter-Insurance Exchange,
a physician owned and governed medical professional liability insurance
company, and granted permission for Conventus to solicit applications
and capital for its formation.
"With the approval of Conventus' business plan, New Jersey
physicians and surgeons are now one step away from having their
own
company to provide quality and affordable coverage, and to regaining
control over their escalating medical professional liability insurance
costs," said Conventus founding member Steven P. Shikiar, MD,
FACS.
"Most commercial insurance companies have responded to the
`New
Jersey malpractice insurance crisis' by either pulling out of the
state or seeking large rate increases. I am seeing too many
colleagues, all excellent physicians, being declined for coverage
or
watching their premiums increase by 50 percent or more," Dr.
Shikiar
continued. "Unlike a stockholder-owned company, Conventus will
be a
non-profit venture, enabling it to keep rates below those now
commonplace in the commercial market."
An initial membership offering commences immediately and closes
on
November 15th. Physicians and surgeons who join during this period
will be offered two-year policies, guaranteeing coverage and locking
in capital contribution amounts. Premium rates and capital
contribution requirements may be higher in subsequent offerings.
Commitments to join must be received by November 15th to qualify
for
the initial offering rates.
"The plan is to raise sufficient funds to finance operations
and
begin to issue policies no later than January 1, 2003," said
Richard
Augustyn, CEO, NIP. "We plan to offer membership to all primary
care
physicians and specialists. We are committed to disciplined underwriting
while offering membership to physicians and surgeons who have experienced
claims while providing quality care."
"New Jersey's physicians know there's a crisis and have been
asking for a solution," said Albert A. Talone, D.O., President
of the
New Jersey Association of Osteopathic Physicians and Surgeons. "This
is it. It's time to unite and take concrete action. In order to
commence
operations, we must have at least 200 membership commitments
by November 15th. If we don't, New Jersey physicians will lose this
opportunity to take back control of their medical professional
liability insurance destiny, and be left at the mercy of the
commercial insurance market."
To obtain applications and details on how their clients can apply
for membership, brokers should contact John Wehner, COO, NIP at
(800) 446-7647, Extension 241.
NIP is a premier administrator of highly specialized business
insurance programs. Formed in 1990, NIP provides a full range of
integrated insurance services including underwriting, rate making,
policy issuance, endorsements, claims handling, loss control, risk
analysis, marketing and distribution.
Earlier this year in response to market conditions and demand NIP
launched an alternative risk practice that specializes in establishing
and managing group-based alternative risk transfer vehicles. It's
initial venture was the successful launch of the Garden State
Municipal Joint Insurance Fund (GSMJIF). The GSMJIF is already one
of
the largest joint insurance funds in the State of New Jersey, insuring
the property and casualty requirements of towns comprising over
240,000 NJ residents.
With corporate headquarters in Woodbridge, New Jersey, NIP has
a
national presence and administers LandPro®, one of the largest
programs for landscapers in the United States, and TreePro™,
the
largest program for tree services in the United States.
National Insurance Programs has formed NIP Management Company,
LLC to act as the organizer of the Conventus initiative and to administer
the Conventus program under the auspices of the physician-composed
Conventus Board of Governors.
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