A new doctor-owned malpractice carrier is expected to be licensed in Florida within 30 days, making it the fifth carrier in a state that has seen soaring malpractice insurance rates and reductions in services by other carriers.
Healthcare Underwriters Group of Florida, based in Dania, Fla., was established earlier this year and has signed up 100 to 150 doctors so far, says CEO Steven Salman in an interview.
He says HUGFL, a reciprocal insurance company that is owned and governed by doctors and covers all specialties, would help fill gaps created by carriers' recent pullouts and pullbacks from the state.
In September, Los Angeles-based Farmers Insurance Group of Companies, which has some business in Florida, announced it is dropping malpractice insurance and will stop renewing existing policies nationwide Jan. 1.
Last week, MedPro, based in Fort Wayne, Ind., said it would not renew 450 physicians' policies that expire Jan. 1. MedPro added, however, that it is not exiting the state, where it insures a total of 2,000 physicians.
Salman, a former malpractice insurance executive, says he has been meeting with Florida licensing authorities and is optimistic that they will approve his application by early November.
He says the company is accumulating $5 million in reserves and has arranged reinsurance with six different companies.
Salman acknowledges that HUGFL will have an easy start because new carriers have few payouts to make. But when the waters get choppier later on, he asserts his company will thrive because it will be the only Florida-based carrier in the state and physicians will have a central role in its claims decisions.
At out-of-state carriers, he says, "claims decisions are being made or not made by companies two to three states away."
As a state-based company, HUGFL can keep close tabs on local legal activity and use doctors who understand local standard of care on its claims committee, Salman says.
He adds that, unlike some other carriers, "we're not going to settle nuisance cases."