ISMIE Mutual will distribute nearly $17 million in dividends to eligible policyholders over a 12-month period starting this July 2010.

The new dividends reflect the continuing improvements in Illinois’ medical litigation climate and positive underwriting results for the 2005 through 2008 policy years. This is the fourth consecutive year ISMIE has issued policyholder dividends, bringing the total amount of dividend dollars granted to policyholders since 2005 to $54 million.

“This dividend is the direct result of several years of comprehensive medical liability reforms, including limits on arbitrary non-economic damage awards in medical malpractice lawsuits,” stated ISMIE Chairman Harold L. Jensen, MD.

While these reforms brought stability to Illinois’ medical liability insurance market, earlier this year the Illinois Supreme Court “turned its back” on patients and doctors in its 4-2 decision to overturn the state’s 2005 medical lawsuit reform law.

“This reversal certainly could impact rates and potential dividends in future years,” said Dr. Jensen. “Illinois has long been known for its adversarial legal climate, and the court’s ruling on this matter is clearly a step in the wrong direction.”

ISMIE engages outside independent actuaries who examine the applicable policy year and determine the feasibility of funding the dividend pool. Policy years spanning July 1, 2005, to June 30, 2008, met or exceeded established benchmarks, thereby establishing dividend pools for distribution to policyholders.

The dividends will be automatic for policyholders, appearing as a credit on their first renewal notices beginning July 1, 2010. Eligible policyholders are those who have been continuously insured with ISMIE since policy years 2005-2006, 2006-2007 and/or 2007-2008.

For more information on medical liability reform, please visit www.realitymedicine.com.