Another medical malpractice insurer is closing its doors, this time the Hospital Casualty Co. of Oklahoma, according to this Insurance Journal report. The company "was placed in voluntary receivership with the Oklahoma Department of Insurance after the department's board determined the company's reserve deficit had grown to $57.9 million at the end of June. ...The closure will leave 63 hospitals and 231 nursing homes scrambling for insurance coverage. ...Hospital Casualty Co. is a subsidiary of the Oklahoma Hospital Association and was founded in 1977 by 12 Oklahoma hospitals." As we noted last week, the state of Oklahoma has the unenviable distinction of having racked up the highest per-capita cost of medical malpractice defense last year, at $24.47 per head. "Earlier this year, the Physicians Liability Insurance Co. was placed under formal supervision of the Insurance Department because the company didn't have money to pay anticipated claims. PLICO, owned by the Oklahoma Medical Association, is the state's largest physicians medical malpractice insurance carrier."
Martin Grace, who wrote on the subject of doctor-owned med-mal mutuals in June here and here, follows up with a Jul. 30 post here summarizing an article by Michael J. Moody in Rough Notes (more). One of the dilemmas faced by such mutuals is that their operating and cost efficiencies tend to be greatest if they stick to their original mission, which is generally that of insuring medicine within one state; and yet such an eggs- in-one-basket approach leaves them maximally vulnerable to the risks associated with nondiversification.