New Jersey policyholders’ surplus increased $7.8 billion to $564.7 billion at March 31, 2011, from $556.9 billion at year-end 2010. Additions to surplus in first-quarter 2011 included insurers’ $7.8 billion in net income after taxes, $3.9 billion in unrealized capital gains on investments (not included in net income), $1.5 billion in new funds paid in (new capital raised by insurers), and $0.4 billion in miscellaneous additions to surplus, according to ISO, Inc. As a result, the State of New Jersey has received applications for and recently approved new property and casualty insurance carriers to write policies within the state. The title of property and casualty is the superseding line of insurance in which medical malpractice insurance/professional liability coverage falls under.
The entrance of new carriers, the merging of existing carriers and existing carriers coming out of dormancy to pursue organic growth implies a softening in the New Jersey medical malpractice insurance / property and casualty market. Going forward, assuming the trend will continue, the result will be a decrease in premiums from various admitted and surplus lines carriers. Being admitted by the State of New Jersey provides the physicians, insured with an admitted carrier, an additional layer of coverage through the New Jersey Property-Liability Insurance Guaranty Association (PLIGA) if insolvency of the carrier were to occur. In short, PLIGA is much like the FDIC for banking institutions. Surplus lines carriers, on the other hand, are not backed by PLIGA but offer exceptional financial strength and are able to write policies outside the standard single or small group physician policy. Some examples are facility policies, unorthodox practices and high risk practices.
The most notable carrier in relation to medical malpractice insurance in New Jersey is Positive Physicians Insurance Exchange (PPIX) which is fully admitted. PPIX has been in operation for over ten years in Pennsylvania and has been writing policies in New Jersey for approximately one year. PPIX is being offered through Diederich Healthcare and New Jersey medical malpractice quotes can be obtained here or by calling 800.457.7790.To contact the author, call 800-457-7790 and ask for Matt Thompson.