A recently conducted survey reportedly sheds light on how medical malpractice insurers view their industry’s future and what steps they are taking to meet it.
Senior-level executives from nearly half of all U.S. medical malpractice/professional liability insurers participated in the survey – which was conducted by the Robert E. Nolan Company, a consulting firm specializing in the insurance industry. The survey finds:
*Medical malpractice insurance executives are optimistic about the current structure of their individual companies and the industry overall. They do not believe that there will be a dramatic consolidation of the industry in the near future;
*Medical malpractice insurers actively support tort reform. While many industry executives support the current federal initiative to place limits on liability payments for medical malpractice claims, there is no total agreement regarding the ultimate impact on future premium levels. They do believe that the initiative and its debate will bring attention to the problems facing physicians, patients and the health care system;
*The insurers are working diligently with their policyholders to improve risk management programs. They are implementing aggressive programs to improve risk selection and classification. They are taking pricing actions that will improve the alignment of premium-to-loss experience and expectations.
The insurers are also taking steps to improve financial performance, including:
*Improving underwriting processes and results, as well as focusing on refining and adhering to underwriting principles and guidelines;
*Improving claim handling, including focusing on the use of Best Claims Practices;
*Improving risk management through education programs for insureds and improved metrics on program effectiveness.
Executives reportedly believe that there are some reasons to demutualize medical malpractice insurers, but most believe that broad-based demutualization will not occur in the near future.
Instead, identification and resolution of present profitability issues (pricing, underwriting and claims handling) take priority in the near term.
To download the complete survey report, titled “The Future of the Professional Liability Industry,” visit the Robert E. Nolan Company’s Web site at http://www.renolan.com .
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