A.M. Best Reaffirms Superior Rating of the Cooperative of American Physicians’ Mutual Protection Trust
December 16, 2021
The Cooperative of American Physicians, Inc. (CAP) announced today that the Mutual Protection Trust (MPT), its medical malpractice/professional liability coverage product for California physicians, again earned an A+ (Superior) rating from A.M. Best. This marks the 15th-consecutive year MPT achieved this rating.
As part of its grading report, A.M. Best praised MPT for its financial flexibility and capital strength, sound invested asset base and ability to access capital. The report also highlights CAP’s “strongest level of risk-adjusted capitalization and favorable market position in California as the second-largest provider of MPL coverage in the state.” It further cited CAP’s company culture that is focused on enterprise risk management and strong internal controls.
“For 15 years now, our MPT product has earned an A+ Rating from A.M. Best, a testament to the collective efforts of a team that is committed to supporting its physician members and their financial health in the most effective way possible,” said Sarah Scher, CAP chief executive officer.
A.M. Best also acknowledged the financial strength of the Cooperative of American Physicians Insurance Company, Inc. (CAPIC), which earned a rating of A- (Excellent). CAPIC is a wholly owned subsidiary of CAP and provides reinsurance and other benefits to CAP and its primary medical professional liability partner, MPT.
LAMMICO Named ‘One of the Best and Brightest Company to Work For’ in the Nation
December 15, 2021
LAMMICO was named one of the Best and Brightest Companies to Work For in the Nation for fall 2021 by the National Association for Business Resources. The 2021 Fall National winners were assessed by an independent research firm that reviewed a number of key measures relative to other nationally recognized winners, based on categories such as communication, work-life balance, employee education, diversity, recognition, retention and more.
The Best and Brightest Companies to Work For in the Nation offers different timelines of applications throughout the year: spring, summer, fall and winter. The fall Best and Brightest National winners honored 167 organizations from across the country out of 1,500 nominations.
According to LAMMICO, its commitment to work-life balance and flexibility to the recognition. LAMMICO employees report valuing the benefits of flexible work hours, compressed workweeks, remote work and telecommuting.
The Best and Brightest Companies to Work For in the Nation winners will be honored at the virtual Illuminate Business Summit week in January 2022. During the Illuminate Business Summit, LAMMICO and the other winning companies will be celebrated for demonstrating exceptional innovative human resource practices and setting high standards for all businesses.
“This honor reflects the heart of LAMMICO and its people, who are among the best and brightest I know,” said J. Michael Conerly, MD, LAMMICO president and chief executive officer. “I am grateful for — and proud of — the LAMMICO staff who successfully worked during the pandemic and hurricane recoveries to best serve the needs of our insured healthcare providers.”
LAMMICO is headquartered in Metairie, Louisiana, and has offices in Baton Rouge and Shreveport.
AM Best Assigns Credit Ratings to Applied Medico-Legal Solutions Risk Retention Group, Inc.
December 15, 2021
AM Best has assigned a Financial Strength Rating of A- (Excellent) and a Long-Term Issuer Credit Rating of “a-” (Excellent) to Applied Medico-Legal Solutions Risk Retention Group, Inc. (AMS RRG) (Phoenix, AZ). The outlook assigned to these Credit Ratings (ratings) is stable.
The ratings reflect AMS RRG’s balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management.
AMS RRG’s balance sheet assessment is supported by risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), at the strongest level. The assessment also considers the company’s consistent surplus growth through earnings and required capital contributions from policyholders. In order to be an insured, members are required to contribute 30% of their mature claims-made premium as capital. These member contributions are paid over a three-year period, which results in a significant portion of capital being receivable from policyholders. The balance sheet is further solidified by an adverse development cover, which insulates the company from any future reserve development on business written in 2020 and prior. The very strong balance sheet strength assessment also considers enhancements to the company’s reinsurance program and planned capital contributions totaling $35 million in the form of surplus notes and equity, which are expected to be implemented in the fourth quarter of 2021.
While the company’s reported results have been subpar, more recent accident-year results have been on par with its peers when adjusted for swing-rated reinsurance. This assessment also considers management’s recent reinsurance initiatives, which are expected to insulate the company from much of its legacy business written prior to 2021. These initiatives include the elimination of swing-rated reinsurance with more traditional reinsurance going forward, the purchase of an adverse development cover, and the purchase of a swing premium protection cover – all of which are expected to reduce volatility of underwriting results and earnings drag going forward. The overall operating performance assessment of adequate places considerable weight on management’s projections and the company’s expected return to underwriting profitability in 2022.
AMS RRG provides medical professional liability (MPL) coverage to over 3,000 individual physician and small physician group members. The limited business profile assessment primarily reflects product and geographic concentration risks as a monoline MPL writer, with approximately 70% of premium volume in its top five states of operation, which exposes the group to risks associated with changes in underwriting cycles, loss cost trends, health care delivery and the legal, economic and regulatory environment.
The company benefits from an appropriate ERM program that promotes clear communication throughout the organization. A formally defined risk appetite and tolerance have been established as foundational elements of the framework. AMS RRG also maintains an appropriate fixed-rate reinsurance program in excess of its $500,000 net retention per claim and per clash. Furthermore, awards-made coverage of $10 million provides additional protection.
The stable outlooks reflect AM Best's expectation that the company will maintain its overall balance sheet assessment, supported by risk-adjusted capitalization at the strongest level, and restored level of underwriting results and operating profitability that are generally in line with management's projections.
Negative rating action could occur following a weakening of overall balance sheet strength, a considerable decline in risk-adjusted capitalization or other quantitative and/or qualitative balance sheet metrics. Negative rating action may also occur if operating and underwriting results differ materially from management's projections as a result of unfavorable shifts in claim frequency or severity, changes in market dynamics or the emergence of adverse loss reserve development on prospective accident years not covered by the adverse development cover.
Medical Liability Monitor December 2021 Highlights
December 6, 2021
The December 2021 issue of Medical Liability Monitor features the following articles and more. Click here to subscribe today:
Federal Appeals Court Narrows PREP Act Liability Protections
Almost two years after the U.S. government declared COVID-19 a public health emergency, federal courts are beginning to narrow the application of the Public Readiness & Emergency Preparedness (PREP) Act, a law invoked via emergency declaration in early 2020 to shield providers of pandemic countermeasures from civil liability. A recent, precedent-setting federal appeals court decision raises concern over the scope of protections for hospitals, nursing homes and healthcare providers …
Milliman Inc. Analysis of Third-Quarter Financial Results for MPL Specialty Writers
Milliman actuaries note continued premium growth continued for medical professional liability specialty writers in the third quarter, although it was driven more by non-MPL premiums — which have been increasing by more than 30% per annum — than earlier this year ...
California Hospitalist Wants Federal Court to Declare Disciplinary Hearings Unconstitutional
A California hospitalist who had his hospital privileges rescinded in 2015 for substandard performance and inadequate record keeping filed a civil action last month asking a federal court to reinstate those privileges, alleging a lack of due process during medical disciplinary hearings violates the Fourteenth Amendment of U.S. Constitution …
ProAssurance Q3 Results Benefit from NORCAL Acquisition
Last month, ProAssurance Corp. reported a net income of $12.2 million for the quarter ended Sept. 30, 2021. The company posted a third-quarter current-accident-year loss ratio of 85.2%, net-loss ratio of 82.1%, underwriting-expense ratio of 24.5%, combined ratio of 106.6% and operating ratio of 99.5%. ProAssurance also boasted a $34.5 million net investment result, an increase of 58.5% over the same period in 2020. ProAssurance’s Specialty P&C Segment reported $235 million in gross premiums written for the third-quarter 2021, up from $158.3 million for the same period in 2020. The Specialty P&C Segment’s increase in gross premiums written is primarily attributed to ProAssurance’s acquisition of NORCAL Group, which was finalized on May 5, 2021 …
AMA Adopts Policy to Combat Disinformation by Healthcare Professionals
Acknowledging the dangerous spread of public health disinformation during the COVID-19 pandemic, physician, resident and medical student members of the American Medical Association (AMA) House of Delegates adopted policy last month aimed at combatting public health disinformation disseminated by healthcare professionals …
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