A medical professional liability insurance provider serving nearly 500 medical professionals in Missouri and Kansas has been placed into rehabilitation after the Kansas Insurance Department (KID) found the company’s financial condition had deteriorated significantly.
Kansas Insurance Commissioner Vicki Schmidt filed a petition, with the consent of the board of directors of Physicians Standard Insurance Co. (PSIC), seeking the rehabilitation order.
The order signed by Shawnee County District Judge Richard Anderson states that PSIC “is in such condition that the further transaction of business would be hazardous financially to its policyholders, creditors, or the public.”
In a media release, Schmidt said KID found that “PSIC’s financial condition had deteriorated to the point it was necessary to take the extraordinary step of obtaining a court order to give the Department the authority needed to protect the consumers and policy holders of PSIC.” She said she remains “fully committed” to rehabilitating the company and protecting consumers.
According to the KID, while the company serves medical professional in Kansas and Missouri, most of its approximately 484 policyholders are in Missouri. Information on the PSIC website shows the company is headquartered in St. Louis, Missouri. The rehabilitation order states, however, that the company “is a domestic stock insurance company organized under the laws of the State of Kansas.”
In a letter to policyholders dated Aug. 23, Schmidt said rehabilitation “does not mean PSIC has been declared insolvent or is being liquidated at this time.” PSIC will continue to operate and current insurance policies will remain in-force under rehabilitation.
“PSIC continues to renew policies and cover policyholder claims as long as policyholders pay premiums when due. Policyholders should continue to file claims as they have in the past and can continue to pay their premiums,” Schmidt said in the letter.
Those insureds who pay premiums by check are instructed to remit payment to the company’s mailing address in St. Louis.
The judge’s order put on hold for 90 days any legal actions and proceedings, including arbitration, to which PSIC is a party.
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