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Physicians' Reciprocal Insurers (PRI) Transitions to Self-Management

Medical Professional-SF
July 11, 2017
Physicians' Reciprocal Insurers (PRI), the second largest medical malpractice insurer in New York state, has established a new management subsidiary to serve as attorney-in-fact and manage the business operations. PRI has terminated its management agreement with Administrators for the Professions, Inc. (AFP). PRI insureds are unaffected by this business structure change and remain fully protected, according to the terms of their policies.

PRI's decision to self-manage and terminate the agreement with AFP follows an order by the New York State Department of Financial Services ("the Department") that AFP no longer continue as PRI's attorney-in-fact. That order comes after an examination of PRI by the Department that uncovered numerous irregularities in regards to actions undertaken by AFP. The Department is aware of and supports the transition to self-management.

"With the formation of our new subsidiary to serve as attorney-in-fact, PRI is positioned to be more responsive to our constituents, including policyholders, claimants, and brokers," said Barry Schwartz, chairman of the Board of Governors of PRI. "We are confident that direct management of our company will be more cost effective and can restore the company to profitability. We are looking forward to a bright future."

PRI has engaged the consulting firm The Princeton Partnership, LLC, to assist in the improvement of operations, underwriting, and claims management. Bruce Shulan, managing partner of the firm, will serve as CEO of the new attorney-in-fact on an interim basis until a management team is hired in conjunction with the Department.

PRI is a "reciprocal" medical malpractice insurer owned by its physician policyholders. It is one of only three fully licensed insurers writing medical malpractice insurance for doctors, clinics, and hospitals in the state of New York, and it writes business exclusively in the state.

Read more on reciprocals in the Captive.com articles "What Is a Reciprocal Insurance Company, and How Is It Taxed?" and "What Is a "Reciprocal" or "Reciprocal Risk Retention Group?"
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