Rating Uptick for ISMIE Mutual

It’s the season to pull fish from end-of-the-dock waters. It’s also the “rating season” for insurance companies, including ISMIE Mutual. In a June 5 news release, A.M. Best Company, the rating agency for insurance carriers, affirmed ISMIE’s financial strength rating of B+ (Good). In addition, ISMIE “hooked” a stable designation for its financial strength, an improvement over last year’s outlook.

“Clearly, the effects of our 2005 medical litigation reform laws are one reason ISMIE’s score is moving in the right direction,” said ISMIE Mutual Chairman Harold L. Jensen,
MD. “With the reform law in place, a significant drop in claims frequency has resulted in increased surplus for ISMIE and our policyholders. This financial security is a major factor in Best’s rating process.”

Just as a well-stocked tackle box can predict a better chance on the lake, ISMIE’s A.M. Best rating reflects a tool kit that includes:

• Improved operating performance.
• Adequate risk-adjusted capital.
• The benefits of using high-quality reinsurers.

All were reasons cited by A.M. Best for the newly revised rating. Notably, ISMIE’s stable designation is also based on its history of high policyholder retention, aggressive claims management and emphasis on risk management.

Spawning future strength

A.M. Best pays very close attention to financial surplus in its rating process. This surplus is the monetary cushion that protects policyholders in case of unexpectedly high claims – and is a key indicator of long-term viability for insurance companies.

ISMIE’s improved stability is a factor in the recently announced dividend pool, steady premiums for the 2007-2008 policy year and the partial lifting of the moratorium on new business. In addition, policyholders can be assured of continued essential programs such as Risk Rewards, state-of-the-art claims services and physician advocacy efforts.

As the medical liability market in Illinois “softens,” other professional liability carriers are luring Illinois physicians and may use their recent financial strength ratings as bait to land new customers. In some cases, these insurers left Illinois for calmer waters when the pre-litigation reform market made it too difficult for them to operate profitably here. ISMIE, on the other hand, hung tough through the lean times. Our 30-year tenure of serving physicians in the Illinois medical liability insurance market is unbroken and unparalleled.

Getting along swimmingly

Maintaining financial stability for the long term is ISMIE’s aim. Dr. Jensen explains: “While ISMIE is pleased with our solid rating by A.M. Best, we know there are other reasons we’re considered the leading medical liability carrier in the state. Foremost, ISMIE is dedicated to serving Illinois physicians – our colleagues. And the loyalty demonstrated by these doctors spurs us on to provide the best coverage at the fairest price, to innovate new programs and products, and to remain vigilant in advocating for our policyholders to assure a welcome state in which to practice.”

And that’s no fish story.

For more information on ISMIE Mutual’s A.M. Best rating, view the news release and FAQs.