American medical malpractice insurer The Doctors Company has concluded the acquisition of Hospitals Insurance Company (HIC) and FOJP Service in a deal valued at around $650m.

HIC operates as New York State admitted and licensed insurance company, while FOJP Service is a service organisation that offers third-party comprehensive insurance and risk management advisory services to HIC-insured hospitals.

Commenting on the deal, The Doctors Company chairman and CEO Richard Anderson said: “We are excited to bring our mission to advance, protect, and reward the practice of good medicine to an even greater number of healthcare providers in New York. Our mission is beautifully aligned with the great work of HIC and FOJP.”

Proceeds from the deal will be returned to the not-for-profit hospitals including The Mount Sinai Hospital and Beth Israel Medical Center (Mount Sinai), Montefiore Health System (Montefiore), and Maimonides Medical Center (Maimonides), which owned and founded HIC and FOJP more than 30 years ago.

With the completion of the acquisition, a new business unit known as Healthcare Risk Advisors (HRA) will be formed within the TDC Group.

The new entity will take the place of FOJP and focus on third-party comprehensive insurance and risk management advisory services, including management of the self-insured programs of large healthcare organisations.

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HIC will remain operating as an admitted New York-domiciled insurer. It will continue to offer coverage for hospitals, physicians affiliated with HIC’s insured hospitals, and long-term care facilities and social services agencies.

The staff of HIC and FOJP will become part of HRA. Noeleen Doelger as chief operating and financial officer and Robert Kauffman as president will oversee the management of HRA and HIC.

Walter Harris will assume a consulting role with the TDC Group and report to Anderson. Previously, he served as president and CEO of HIC and FOJP.

Kauffman said: “This transaction provides a platform on which to expand our self-insured programs to additional physicians, hospitals, and healthcare systems.

“At the same time, we remain steadfast in our commitment to provide our founding hospitals with an excellent service that supports what they do best—providing quality healthcare to their communities.”