Insurance head puts med mal insurer in rehabPosted On: Aug. 30, 2019 11:53 AM CST
Physicians Standard Insurance Co., a medical malpractice insurer that provides coverage to some 484 medical professionals in Kansas and Missouri, has been placed under the supervision of the state insurance department, Kansas Insurance Commissioner Vicki Schmidt said Tuesday.
The insurer saw its net loss grow 337% to $1.57 million in 2018 compared with its net loss in 2017, according to A.M. Best Co. Inc. data. The company’s net written premium also grew to $6.87 million in 2018, from $152,000 in 2017, according to the data.
“The Department determined PSIC’s financial condition had deteriorated to the point it was necessary to take the extraordinary step of obtaining a court order to give the Department the authority needed to protect the consumers and policy holders of PSIC,” Ms. Schmidt said in a statement.
“I remain fully committed to rehabilitating PSIC and continuing our responsibility of protecting consumers,” she said.
A District Court in Shawnee County, in Topeka, Kansas, signed an order placing the insurer in rehabilitation under supervision of the state insurance department on Aug. 20.
“Based on the Kansas Insurance Department’s investigation of Physicians Standard Insurance Company to date, the Commissioner has determined the company is in such condition that the further transaction of business would be hazardous financially to its policyholders, creditors, or the public,” the order stated.
The order was entered with consent of the board of directors of PSIC, the Kansas insurance department said in its statement.
The order “allows the Commissioner, as Rehabilitator, to reform and revitalize PSIC to protect policyholders,” said Ms. Schmidt in an Aug. 23 letter to policyholders.
Under the order, the insurer continues to operate, and current policies remain in effect, the letter said.