SEATTLE, Aug. 6, 2012 /PRNewswire/ -- Physicians Insurance A Mutual Company announced today the successful acquisition of the EMPAC and SCRUBS risk retention group management companies providing Physicians Insurance with a nationwide alternative risk financing platform. Through this acquisition Physicians Insurance now can offer alternative risk financing options to physicians, clinics, hospitals, their respective single/multi-state associations, and other healthcare facilities.
"This was a strategic decision on our part," noted Physicians Insurance President and CEO Mary-Lou Misrahy. "It leverages our leadership role and enables us to respond to changes in the health care environment. Some of these changes are forcing medical professionals and facilities to rethink their risk financing options, and now they have another tool in their toolbox." For more than 30 years, Physicians Insurance has led the way in meeting the changing insurance needs of medical professionals by providing innovative medical professional liability coverage.
The company currently serves physicians, clinics, and hospitals in Washington, Oregon, and Idaho, and with this acquisition can establish and manage new or existing risk retention groups for others who want to consider alternative risk financing. This acquisition also strengthens the company's ability to offer management services to existing risk retention groups and self-insured organizations.
"There are many new practice models in health care today. Many of those practice models will continue to be best served by the traditional insurance protection provided by Physicians Insurance, but some will want to explore alternatives such as risk retention groups," noted Misrahy. "By providing different risk financing options we are able to collaboratively work with groups in new and exciting capacities to lower their risk exposure."
Physicians Insurance Board Chair Brian Wicks, M.D., commented "SCRUBS RRG and EMPAC RRG are physician-driven companies, just like Physicians Insurance. This means that our focus in managing these companies continues to be on improving the delivery of safe and effective medicine. That's the most important bottom-line."
Physicians Insurance is a Mutual Company owned and governed by physician policy holders. This acquisition enables the company to extend its ability nationwide to serve physicians, groups, and facilities that want to explore alternative risk financing options, or want new management services for their existing self-insurance programs.
About Physicians Insurance
Physicians Insurance A Mutual Company provides medical professional liability insurance coverage to more than 6,700 members in Washington, Idaho, and Oregon, in addition to risk-management consulting, continuing medical education, and claims administration services. The company, founded in 1981, has grown to be the largest insurer of physicians in Washington State and is rated A- (Excellent) by A.M. Best Company. [i]
About EMPAC RRG
Emergency Medicine Professional Assurance Company RRG (EMPAC) is a professional liability insurance company formed in 2003 by emergency medicine physicians seeking a viable, long-term alternative to the traditional insurance market. EMPAC serves as a predominantly single-specialty risk retention group insuring emergency medicine groups, and residency trained, Board Certified professionals.
About SCRUBS RRG
SCRUBS RRG is a professional liability insurance company formed in 2007 by Urologists, and is the only Urologic specific medical professional liability insurance company in the United States. SCRUBS RRG is dedicated to assuring the long-term availability of coverage at stable and reasonable prices to the specialty.
What is the difference between a risk retention group and its management company?
A Risk Retention Group (RRG) is a type of insurance company where the policy holders are also the stockholders. In the broadest sense, a risk retention group insures businesses of a similar type in regards to their liability exposures.
RRGs are authorized under a federal statute and preempt state law in many significant ways, the most significant being avoidance of having multiple state filing and licensing requirements. Thus, once domiciled in one state the RRG must be accepted by all other states though the RRG must register in each state in which it wishes to do business.
Management companies are contracted to the RRG's to handle a variety of functions of the carrier, this includes regulatory compliance, claims administration, investment strategies, underwriting, marketing and servicing of policies for the risk retention groups. The companies are not owners but stewards of the insurance carriers.
[i] A.M. Best's ratings are on a scale from A++ (superior) down to D (poor) with even lower ratings for companies under regulatory supervision or in liquidation.
SOURCE Physicians Insurance