(a)

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Terms Used In Hawaii Revised Statutes 435C-4

  • Medical malpractice insurance: means insurance coverage against the legal liability of the insured and against loss, damage, or expense incident to a claim arising out of the death or injury of any person as the result of negligence or malpractice in rendering professional service by any licensed physician or hospital. See Hawaii Revised Statutes 435C-2
  • Plan: means the joint underwriting plan established pursuant to the provisions of this chapter. See Hawaii Revised Statutes 435C-2
(1) Any licensed physician or hospital shall, on or after the effective date of the plan of operation, apply to the plan for such coverage. Such application may be made on behalf of an applicant by a producer authorized by the applicant.
(2) If the plan determines that the applicant meets the underwriting standards of the plan as provided in the plan of operation and there is no unpaid, uncontested premium due from the applicant for prior insurance (as shown by the insured having failed to make written objection to the premium charges within thirty days after billing), then the plan, upon receipt of the premium, or such portion thereof as is prescribed in the plan of operation, shall cause to be issued a policy of medical malpractice insurance for a term of one year.
(b)

(1) The rates, rating plan, rating classifications, territory, and policy forms applicable to the insurance written by the plan and statistics relating thereto shall be subject to §§ 431:14-101 to 431:14-117 unless otherwise provided hereto, giving due consideration to the past and prospective loss and expense experience within and outside this State for medical malpractice insurance of all of the member companies of the plan, trends in the frequency and severity of losses, the investment income of the plan, and such other information as the insurance commissioner may require;
(2) Any deficit sustained by the plan in any one year shall be recouped, pursuant to the plan of operation and the rating plan then in effect by one or both of the following procedures:

(A) An assessment upon the policyholders; or
(B) A rate increase applicable prospectively;
(3) Effective after the initial year of operation, rating plans and rating rules, and any provisions of recoupment through policyholder assessment or premium rate increase, shall be based upon the plan’s loss and expense experience, together with such other information based upon such experience as the insurance commissioner may deem appropriate. The resultant premium rates shall be on an actuarially sound basis and shall be calculated to be self-supporting;
(4) In the event that sufficient funds are not available for the sound financial operation of the plan, pending recoupment as provided in paragraph (3) of this subsection, all members shall, on a temporary basis contribute to the financial requirements of the plan in the manner provided for in § 435C-5. Any such contribution shall be reimbursed to the members following recoupment as provided in paragraph (3) of this subsection; and
(5) The commissioner shall consider requiring the plan to offer policies on a claims made or occurrence basis; provided that the premium rate charged for the policies shall be at rates established on an actuarially sound basis and that are calculated to be self-supporting.
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