Patricia A. Costante, the President and CEO of New Jersey-base MIIX Group, the troubled medical professional liability insurer, got a well deserved vote of confidence on Thursday when the company’s Board of Directors appointed her as its Chairman.
MIIX, which has seen its reserves crumble as its losses mounted, recently received approval from the NJ Department of Banking and Insurance(DOBI) to proceed with a radical restructuring of its business (See IJ Website May 6), and just announced a Q1 loss of $45.4 million, mainly due to strengthening its loss reserves prior to going into voluntary runoff as part of the restructuring (See IJ Website May 7).
Commenting on Costante’s new position, Paul J. Hirsch, MD, and MIIX Vice-Chairman stated that, “Ms. Costante has the full support of the Board and has demonstrated her ability to lead the Company during the past several challenging months and throughout her career. She is a visionary and pragmatic leader and we are pleased to have her serve as Chairman of our Board.”
Costante, who had been the company’s COO, took over at MIIX in November after the brief tenure of Richard J Quagliaroli, and launched the current recovery plan, which envisions raising additional capital to form a new medical professional liability company, supported by physicians and concentrating on New Jersey.
She acknowledged the Board’s action, stating, “I want to thank the shareholders and the Board for their vote of confidence. “This has been a challenging time for MIIX, but it has also turned into a period of renewal and opportunity. With the support of our shareholders and insureds, I am looking forward to a fruitful and promising future for New Jersey’s physicians and surgeons, and for a close alliance with them as we work towards improving conditions for the practice of medicine.”
She still has work ahead. A.M. Best Co. withdrew the financial strength rating of C+ (Marginal) of MIIX Group and assigned it a rating of NR-4 (Company Request). ,” based on management’s decision not to participate in the interactive rating process.” Best state that the “rating action applies to MIIX Insurance Company, and its two subsidiaries, Lawrenceville Property & Casualty Co., Inc. and MIIX Insurance Company of New York,” and that it had also withdrawn its negative outlook.
Best’s announcement detailed the steps MIIX has taken to withdraw from markets other than New Jersey, and the eventual runoff of its business. It also took note of the plans to form a new NJ-based professional liability insurer, and indicated that the DOBI would be closely monitoring the new company’s financial condition.
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