Frequently Asked Questions

What is New Jersey Healthcare Providers Insurance Exchange (“NJHPIX”)?

NJHPIX is a New Jersey reciprocal insurance company licensed by the New Jersey Department of Banking and Insurance. This reciprocal insurer consists of two entities, the Exchange (“NJHPIX”) and the Attorney-in-Fact (“AIF,” or “Management Company”). The Exchange is an unincorporated association whose members are the physician insureds. The AIF contracts with NJHPIX to manage the business of NJHPIX . To join NJHPIX, doctors make a one-time surplus contribution, in addition to their first year premium. The surplus contribution is how the Exchange is funded. NJHPIX has arranged for financing of the surplus contribution and the premium if needed by the physician insured.

View Surplus contribution agreement here

View Financing Information here

Will the surplus contribution be repaid?

The NJHPIX surplus contribution is a one-time payment, payable with a completed application, and is based on the physician’s specialty. The surplus payment will be refunded if an initial policy is not offered by NJHPIX or if the policy is not accepted by the physician.

The insured may be entitled to a return of surplus or a portion thereof within 15 years or if the exchange is sold, provided approval is received from the New Jersey Department of Banking and Insurance and the Attorney-in-Fact.

What distinguishes the NJHPIX program from other insurance companies?

NJHPIX believes that rates can be stabilized if doctors, hospitals, and insurers work together. Physicians must report incidents and claims when they occur, even if they believe that they are not at fault. Physicians and hospitals collaborate on all risk management activities. NJHPIX doctors who are named defendants in the same case agree to work together through a joint defense agreement. Under a joint defense agreement, one lawyer will represent all of the insureds, as long as they are not adverse to one another. NJHPIX also works closely with hospitals to coordinate their defense. Through joint defense and coordinated defense, NJHPIX can reduce the cost of defending claims. As Conditions of Membership, NJHPIX requires early incident reporting, compliance with hospital risk management, and participation in joint and coordinated defense agreements. Each physician insured must comply with the Conditions of Membership as described in the application.

Will I be non-renewed if I report an incident?

NJHPIX guarantees underwriting for at least a four-year period. This means that if the physician complies with the Conditions of Membership, as described in the application, NJHPIX will offer the doctor coverage for four years. However, this does not necessarily mean that the premium will be the same every year. Even if a doctor has reported numerous incidents, NJHPIX will still offer the doctor insurance.

How is the Attorney-in-Fact paid?

NJDOBI has approved a fixed fee based on the Exchange’s annual premiums. For this fee, the Attorney-in-Fact must provide all of the typical services of an insurance company, including risk management, claims management, marketing, underwriting, actuarial, finance, policy issuance, and all regulatory services as well as pay all commissions to brokers and agents. The fee is fixed and the Attorney-in-Fact is charged with providing these services for the fixed annual fee, which must be approved each year by the New Jersey Department of Banking and Insurance.

Is the company part of NJPLIGA?

Because the New Jersey Department of Banking and Insurance licenses the Exchange, all of its insureds are afforded the protection of the New Jersey Property Liability Insurance Guaranty Association (PLIGA) in the event of an insolvency. Risk retention groups do not have such protection.

Does NJHPIX have reinsurance?

Yes. The Exchange is reinsured by A-rated carriers and offers policies with limits of $1,000,000/3,000,000 and retains only the first $250,000 of each claim.