Now is the prime time for healthcare companies or professionals to either join or start a captive, experts told Captive Intelligence at the 2022 Cayman Captive Forum.
“We’re definitely in a hard market, rates are going up and capacity is less,” Amy Evans, executive vice president at Intercare Holdings, said.
“There’s still a lot of capital in the commercial market, but they are reducing cover and they’re not insuring a lot of things.”
Evans also noted that healthcare professionals are increasingly wanting to control their own risk.
“They are just tired of the volatility, they are naturally creative people who are always striving for innovation because you can’t be complacent in healthcare,” she added. “You’ve always got to be one step ahead and strategic.”
Dr Ira Richterman launched the Cayman-domiciled StarKap Insurance Company in 2005, due to proliferating costs for medical malpractice insurance in the commercial market.
“For myself, a lot of my friends, malpractice insurance as a small independent group was unaffordable,” he said.
“As a result, in 2005, an orthopaedic group, an anaesthesia group, and a large multi-specialty, medicine group got together, and we all felt the captive was the right thing for our practices and more importantly for our community.”
M&A
Heather McClure, chief risk advisor in the US Healthcare Practice at Aon, noted that the merger of physicians into hospital employment over the last three years has grown “exponentially”, which has benefited physicians in their defence against lawsuits.
“What that means for the risk is that those physicians don’t have their own separate policies anymore, as their risk is joined with the hospitals,” she said.
McClure added that the plaintiff’s attorneys used to be able to pick off and sue the physician or the hospital separately. “And now there’s that opportunity for joint defence.”