The Owner Benefit Plan (COBP)
Read about this year’s $1.2 million owner investment return
Click here to see an image of this year’s payment envelope
Frequently Asked Questions
The COBP consists of two components:
Dividend (for current members) and
Return of Owner Capital Contributions:
- For members who have experienced a qualified event (see COBP rules, below)
- For Distinguished Members who:
- have been Members for five (5) consecutive years,
- have reached the age of fifty-five (55) as of December 31 of the most recent preceding year
- have paid their owner capital contributions in full, and
- are Members as of the date Dividends and Owner Capital Returns to Members are declared for the current Plan year.
- Question: Who is eligible to receive dividends?
Answer: Any member of Conventus Inter-Insurance Exchange (“Conventus”) who was an active member on December 31st of the previous year (“the Plan year”) is eligible to receive a dividend payment.
- Question: How are the amounts of the individual member dividend payments calculated?
Answer: The total dividend component is divided among all eligible members based upon three factors: 1) the eligible member’s premium in relation to Conventus’ total annual premiums; 2) the member’s owner capital contribution; 3) years of membership.
- Question: Who will be the named payee on the dividend check?
Answer: The check will be issued in the name of the policyholder, or the name shown on the Assignment of Surplus Contribution Rights Form, where applicable.
- Question: If I am a member of a medical group (Group Practice), who will be the named payee on the dividend check?
Answer: If the owner capital contribution for your policy has been paid by and assigned to a group name, the dividend check will be made payable to the group. If a physician paid his/her own owner capital contribution and there is no assignment to a group name, the dividend check will be made payable to the individual physician member.
- Question: Will dividends be paid by Conventus every year?
Answer: Dividends are paid to members based upon annual earnings, as well as Board and regulatory approvals; therefore, future dividends cannot be guaranteed.
- Question: What are the general rules applicable to dividend check processing?
Answer: Dividend checks will be sent to the current billing address without forwarding options. Checks not cashed within 180 days of issue will be voided. Checks returned and not cashed will be eligible to be reissued upon request by the member. After one year from date of issuance, unclaimed funds will be reported to the State of New Jersey, in accordance with the guidelines of the Department of the Treasury – Unclaimed Property Administration.
Return of Surplus Contributions
- Who is eligible for a return of owner capital contribution?
Answer: Members who have previously made all or part of a required owner capital contribution and who have experienced a qualifying event of death, disability or retirement (“DDR”) according to plan rules, and to whom an Extended Reporting Period endorsement has been previously issued, are eligible for return of owner capital contributions. Qualified events must have been reported in writing to Conventus prior to or during the previous calendar year to be eligible for the COBP.
Additionally, Distinguished Members are eligible for return of their owner capital contribution. Distinguished Members are defined as those members who: have been Members for five (5) continuous years; reached the age of fifty-five (55) as of December 31 of the most recent preceding year; have paid their owner capital contributions in full, and have been Members as of the date Dividends and Owner Capital Returns to Members are declared for the current Plan year.
- Question: Will return of surplus contributions be made every year?
Answer: Owner capital contributions are returned to members based upon annual earnings, as well as Board and regulatory approvals; therefore, future returns of owner capital cannot be guaranteed.
- Question: If I experienced a qualifying event, will I receive a payment equal to 100% of my original owner capital contribution?
Answer: This will depend on the amount available for owner capital return as provided for by the COBP and the total owner capital contributions of all members eligible for owner capital return. If funding for the Plan is insufficient to make full owner capital returns to eligible members, distributions of owner capital returns will be made on a pro rata basis and each eligible member’s owner capital account will be reduced by the amount of the owner capital returned. Each owner capital account will remain open until it has a zero balance, at which point it will be closed and no further owner capital distributions will be made.
- Question: What if I have an outstanding owner capital contribution payment due Conventus?
Answer: If a Member has a past due owner capital contribution obligation, and is eligible for return of a owner capital contribution due to a qualified event, the outstanding owner capital contribution obligation of the Member will be waived.
- Question: What if my group paid my owner capital contribution?
Answer: For policies where an Assignment of Surplus Contribution Rights is on file with Conventus, or provided by the group at Conventus’ request, checks will be issued in the name of the current assignee. Any valid amendment to the original assignment will void prior assignment agreements. Any waived owner capital contribution amounts will not be eligible for return.
- Question: What if the qualifying event occurs after I am no longer a Conventus member?
Answer: If a qualifying event occurs after a member has left the Company, the physician or his/her estate must report the event in writing to the Attorney In Fact (NIP Group) during the calendar year to be eligible for inclusion in the following year’s COBP owner capital return distribution, where plan criteria have been met and required approvals have been received.
- Question: What are the general rules applicable to processing of owner capital return checks?
Answer: Owner capital return checks will be sent to the current address that Conventus has on file. Checks not cashed within 180 days of issue will be voided. Checks returned and not cashed will be eligible to be reissued upon request by the member. After one year from date of issuance, unclaimed funds will be reported to the State of New Jersey, in accordance with the guidelines of the Department of the Treasury – Unclaimed Property Administration.
Please Note: Disputes as to owner capital assignment or eligibility will be determined by the COBP rules as interpreted by the AIF.