FPIC Insurance to be bought by Doctors Co for $362 million

Bangalore (Reuters) - FPIC Insurance Group Inc FPIC.O said it agreed to be bought by the Doctors Company for about $362 million in cash, joining the consolidation in the medical malpractice insurance business.

Medical malpractice insurance is a type of professional liability insurance that doctors practicing in the United States are required to have. Insurers have been looking to gain a foothold in this lucrative space to bolster their specialty offerings.

Last September, ProAssurance Corp (PRA.N) agreed to buy American Physicians Service Group SMPH.O and, in 2009, FPIC bought Advocat MD Financial Group.

The Doctors Co offer of $42 per share represents a 31 percent premium to FPIC's closing price on Monday.

The deal will add 18,000 customers to The Doctors group, enhancing its position as one of the largest insurers of physician and surgeon medical professional liability.

The Doctors Co was founded in 1976 as a physician-owned and operated provider of medical liability insurance.

Shares of Jacksonville, Florida-based FPIC rose 29 percent to $41.50 in early trade on Nasdaq.

(Reporting by Jochelle Mendonca; Editing by Anil D'Silva and Sriraj Kalluvila)