The American Hospital Association has completed the sale of its highly profitable liability insurance subsidiary to MMI Cos. of Deerfield, Ill., for $30 million in cash and stock.
MODERN HEALTHCARE disclosed the pending sale of Health Providers Insurance Co. in January (Jan. 30, p. 17).
HPIC is a liability reinsurance company that sells excess coverage to hospitals above their basic level of liability insurance. It insures about 2,000 hospitals directly or through other companies.
In 1993, HPIC earned $6.9 million on total revenues of $25.5 million. It had total assets of $150.3 million that year. It also reported more than $100 million in reserves for insurance losses.
MMI picked up HPIC for $15 million in cash and $15 million in convertible preferred MMI stock.
MMI is a diversified insurance company, offering liability insurance and risk management services to healthcare providers.