N.J. Dept. Approves MIIX Advantage

August 6, 2002

New Jersey Banking and Insurance Commissioner Holly Bakke issued her conditional approval of MIIX Advantage, a new medical malpractice insurer that will begin writing policies by Sept. 1.

“The Department’s conditional approval of MIIX Advantage improves the availability of medical malpractice coverage in New Jersey,” Bakke said. “This action is good news to physicians who are interested in this new company but needed some certainty that it would be approved.”

A prior company, the MIIX Group, was placed in solvent runoff on May 3. Bakke’s action allows MIIX Advantage to formally organize as an insurance company. When that process is complete later this month, MIIX Advantage will be able to offer coverage to doctors whose MIIX Group policies expire on or after Sept. 1. Only doctors who made contributions to the MIIX Advantage capital campaign are eligible. The Department had previously authorized the MIIX Group to offer renewals through Aug. 31. The MIIX Group, until recently New Jersey’s largest medical malpractice carrier, is now the second-largest insurer with 36 percent of the market.

Final approval will come after MIIX Advantage completes its certificate of incorporation, and the Department completes reviews of those documents. Also, the Department will conduct an exam to ensure that all of the funds to capitalize the new company were deposited.

Bakke’s action follows her May decision to place the MIIX Group into solvent runoff after learning that the company’s surplus had dropped $128 million between Sept. and Dec. 2001.

Starting September 1, all policies will be written through MIIX Advantage for doctors who have made a capital contribution to the new company. Physicians whose policies come up for renewal prior to that date will be renewed through the MIIX Group, under the terms of the May 3 decision limiting renewals to New Jersey physicians already with the company.

The Department will continue to offer its placement program for physicians who have trouble finding coverage. Under the program, featured on the DOBI Web site, doctors who show that they have been declined coverage by two companies can submit their claims history to the Department, which will assist them in obtaining a quote.

Bakke has also taken steps to give physicians more choices in the medical malpractice market. Under an order to show cause, the Department is asking carriers to offer deductibles and installment plans. The Department is also promoting broader availability of “claims made” coverage, which could offer significant savings to younger doctors. (A claims made policy offers protection for the year of coverage only.)

In addition, Bakke has met with groups of doctors both in Trenton and at hospitals around the state to gather input and develop solutions that address the problem of affordable insurance for those in high-risk specialties.

“It is my belief that by approaching this not simply as an insurance problem but as a health care delivery problem, this Administration will come up with long-term answers to the rising costs of coverage,” Bakke said.

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