Issue #1
What constitutes excessive surpluses? Who determines the definition of excessive? Even if we could come up with an agreed upon number, insurers can easily restructure reinsurance contracts to lower surplus.
Issue #2
Quote “It appears that insurers are, in some cases, overestimating the amount of malpractice payouts to justify higher premiums”
Obviously they don’t realize that prices aren’t determined doctor by doctor, but by entire book of business. Nor do they realize that most companies writing malpractice insurance pay roughly 1.25 in claims for every $1 they take in. Add to that expenses (marketing, etc), that number climbs to $1.50.
We have updated our privacy policy to be more clear and meet the new requirements of the GDPR. By continuing to use our site, you accept our revised Privacy Policy.
Issue #1
What constitutes excessive surpluses? Who determines the definition of excessive? Even if we could come up with an agreed upon number, insurers can easily restructure reinsurance contracts to lower surplus.
Issue #2
Quote “It appears that insurers are, in some cases, overestimating the amount of malpractice payouts to justify higher premiums”
Obviously they don’t realize that prices aren’t determined doctor by doctor, but by entire book of business. Nor do they realize that most companies writing malpractice insurance pay roughly 1.25 in claims for every $1 they take in. Add to that expenses (marketing, etc), that number climbs to $1.50.