Med mal insurance captive moving to VermontReprints
The University of Vermont Health Network will move its captive to Vermont from Bermuda.
The network’s Board of Directors unanimously approved the move of VMC Indemnity Co. Ltd., a captive that provides medical malpractice insurance coverage, according to a statement by the six-hospital system issued Friday.
“We had an analysis done comparing the two locations and it is clear we can continue to provide low-cost, predictable insurance coverage to our providers if the company is located in Vermont,” John Brumsted, president and CEO of the University of Vermont Health Network and captive board member, said in the statement. “We strongly believe in doing business locally whenever possible so we’re happy that being in Vermont is the best business decision in this case.”
A nonprofit corporation will be established to become the network’s captive insurer and it will seek approval from the Internal Revenue Service to operate as a tax-exempt organization – a process that could take up to a year.
The change in location will have no impact on the providers insured by the plan, according to the network. The cost of making the conversion is estimated to be $35,000 to $50,000 and the state of Vermont will collect about $50,000 annually in premium taxes.
“This is great news for Vermont and validation of our incredibly strong captive insurance industry,” David Provost, deputy commissioner, Vermont Department of Financial Regulation, said in a statement.
The system has more than 1,000 physicians and 2,000 nurses and other clinicians in Vermont and New York.