Trust - TMLT

In the 1970s, Texas physicians againstood together — this time to find asolution to the medical liability crisisthat was making malpractice insuranceunaffordable and unavailable. Onegroup of pioneering physicians workedthrough the Texas Medical Associationand eventually to the state capitol tocreate their own insurance provider —Texas Medical Liability Trust.TMLT is not an insurance company,but a self-insured trust established byTexas Insurance Code Article 21.49-4to provide coverage against health careliability claims to members of theTexas Medical Association. The liabilitycrisis of the 1970s and the desire ofphysicians to control their own destinyled to the formation of this unique organization,designed by physicians to benefitphysicians.Committed to the medicalcommunityPhysicians wanted a company that wascommitted to the entire medical communityin Texas, not a company thatwould “red line” certain regions orphysicians. TMLT is currently the onlycarrier that has consistenly coveredphysicians of all specialties who practicein all areas of Texas.Run by physiciansThe founders of TMLT believed thatphysicians could be their own bestadvocates. TMLT is physician-ownedand led by a Board of Governors electedby policyholders. Board membersare practicing physicians who bringfirst-hand experience and a unique perspectiveto the management of TMLT.Our Trust is a uniqueorganization, designedby physicians tobenefit physicians.Not just settle claimsSince our inception, TMLT’s philosophyhas been to defend doctors, not payclaims. Our founders wanted a companythat would allow physicians to setthe tone for their defense. Only byaggressively defending non-meritoriousclaims can we protect a physician’s reputationand keep the number of malpracticesuits filed against all physiciansin check.Based on Texas experienceTMLT offers one line of coverage andoffers it in one state — Texas. Ourentire business focus is on Texas physiciansand how to protect their practices.Our rates are set based on the claimexperience of Texas physicians, unlikesome national carriers who set theirrates based on national claim data.Additionally, our Texas-based claimstaff and defense attorneys understandthe Texas legal system, the venues, andthe judges.StabilityTMLT was founded by physicians whowanted to create a stable source ofmedical liability insurance for thestate’s medical community. Thosephysicians also wanted a company thatwould stick by physicians when marketconditions in Texas worsened. 26 yearslater, TMLT has weathered two medicalliability crises, and has grown tobecome the largest provider in Texas,currently insuring more than 13,000physicians.Consent to settleAgain, wanting to control their owndestiny, Texas physicians wanted aninsurance policy that required a policyholder’sconsent before settling a case.The TMLT professional liability policysays “the Trust shall not settle anyclaim or lawsuit without first obtainingthe consent of the Named Insured.” Notall medical liability companies includesuch a provision in their policies. Someare silent on the issue, while others stipulatethat the carrier retains the powerto settle a claim.No profit motiveFormed as a not-for-profit trust, TMLThas no profit motive. We are not a stockcompany with an obligation to shareholders.TMLT’s founders knew that itwould be impossible to maximizeshareholder returns and defend physiciansregardless of cost. For this reason,we set responsible premiums that allowfor financial stability and that upholdour end of the insurance contract.FlexibilityAs a trust and not an insurance company,TMLT is not subject to regulationby the Texas Department of Insurance.TMLT’s founders recognized theimportance of allowing physicians toregulate their own company. Thisstructure allows us the flexibility to survivein a volatile insurance market likeTexas. When market conditions change,TMLT can respond quickly and efficiently.But while TMLT is not subject toTDI regulation, we do voluntarily complywith reporting requests. We providethe TDI with our audited financialstatements, our rates, our policy forms,and closed claim reports. We also assistthe TDI with their data studies.Responsible investmentphilosophyOur founders wanted TMLT to adopt aconservative policy for the investmentof its assets with the objective ofachieving maximum yield with maximumsafety. Today, we still keep to thisphilosophy. Trust assets are invested ininvestment quality securities to generateincome to meet operating expenses andactuarial assumptions.TRUST - The Annual Report Magazine21