Residents' Forum

At Your Service

Go for the Best Rating

This column is provided as a service to the membership by the Psychiatrists’ Purchasing Group Inc. (PPG), operator of the APA-sponsored Professional Liability Insurance Program.

Question: After several years of employer-provided malpractice insurance, I now have to purchase my own coverage. In earlier columns, you mentioned several factors to consider when purchasing coverage. You also mentioned the importance of an A.M. Best rating. Would you please address these issues again?

Answer: Evaluating the financial strength and the benefits and features of an insurance company before you purchase insurance is extremely important. There are several factors to consider.

Financial Strength

• The A.M. Best rating provides a very effective method of financial evaluation and represents an independent opinion from the leading provider of insurer ratings. The rating reports on the insurer’s financial strength and its ability to meet its obligations to policyholders. After extensive quantitative and qualitative evaluation of a company’s financial condition and operating performance, A.M. Best assigns a rating that reflects the financial condition of the insurance company. For example, the APA-sponsored Professional Liability Insurance Company’s reinsurance company, Transatlantic Re, is rated A++ (superior) and the insurance carrier, Legion Insurance Company, is rated A+ (excellent). These strong team members ensure financial stability.



• You should also consider how long the insurance company has offered professional liability insurance in your geographic area. Some carriers have a tendency to stop offering coverage in certain areas if they fear a lack of profit or bad losses.

Benefits and Features

A checklist of benefits and features is helpful in your purchase decision. This comparative analysis should include several factors:

• What are the dollar limits of coverage?



• Is the coverage portable; that is, if you move, will your insurance go with you?



• What kind of payment plans are available?



• How accessible and knowledgeable are the risk management and claims staff?



• Does the company offer risk management consultation, seminars, and newsletters?

For more information on the A.M. Best rating, check your local library. The program’s manager, PRMS, has developed a benefits and features checklist. For a complimentary copy, please call (800) 245-3333, ext. 389; e-mail: ohri@prmsva.com.

Question: I recently received my APA-sponsored Professional Liability Insurance Program premium invoice, and I noticed that there were several changes made to the form. Would you please explain the new invoice?

Answer: The revised invoice presents four new features:

1. Annual payment option: For those wishing to pay annually, simply pay the new account balance, and your account will be paid through the end of the policy period. However, you still have the option of paying in four installments with no finance charge.



2. Endorsement premium: If any changes have been processed to your policy, the endorsement premium will show on the invoice to indicate exactly how it affected your premium.



3. Rating profile items: The factors used in determining your rate are indicated on the invoice. These would include your rating area and any discounts that you may be receiving.



4. Running account summary: At any time you will know exactly how much you have paid against your total annual premium.

If you have additional questions or would like to have a copy of the brochure "The Innovative Insurance Invoice: The I’s Have It," please call (800) 245-3333. This brochure provides a diagram highlighting what each entry on the invoice means.

APA welcomes the opportunity to hear from you about APA-sponsored benefit programs. Send your questions on the APA insurance and special benefit programs to At Your Service, Psychiatric News, APA, 1000 Wilson Boulevard, Arlington, Va. 22209-3901; e-mail: pnews@psych.org.