Medical Professional Liability Insurance Premiums are Rising

September 30, 2020

The Doctors Insurance Agency specializes in providing medical malpractice insurance for physicians groups and facilities.

Internal medicine and its subspecialties have historically had some of the most competitive premiums in the United States.

The Doctors Insurance Agency has developed an understanding of which carriers are financially strong and committed in each of these specialties, so that we can provide physicians and groups with the best options. Understanding these specialties can help physician owners, shareholders and partners in these medical groups properly structure their liability contract and save thousands in premium costs.

For example, gastroenterologists frequently work in association with freestanding Surgery Centers and Endoscopy Centers.

Structuring a Medical Malpractice Insurance policy to be properly layered, so that the policy covers the surgery center, the physicians and the anesthesiologists without duplicating premiums is one way that an understanding of the market can help lead to more a more affordable policy.

Financial Strength is challenged in this market

In 2020, premiums have been adjusting for the last nine months, and in a time when financial strength and reserves are being challenged because of lost revenue during the pandemic, this trend that began before March has worsened.

Insurance companies are working to balance the natural desire to accommodate the market by lowering premiums during a time when offices have been closed, patient numbers are reduced and revenues have been shrinking with the need to protect the ability to pay future claims. It is a careful balance—one that has been in play for four decades since the insurance crisis of the late seventies.

Medical Professional Liability Increases across all sectors

Whether you are working at a clinical research organization, managing a medical spa or consulting virtually through telemedicine, premiums are increasing!

For the past 10 years, every carrier providing medical malpractice insurance has reached into their reserves and negotiated with reinsurers to hold premiums steady.

By concurrently working with their medical defense attorneys, the malpractice industry across the country held premiums down until finally in the fall of 2019 we started to see underwriting concessions disappear, discounts were reduced, special programs eliminated, and premiums raised.

10 – 20 % premium increases for medical malpractice insurance

In his monthly newsletter, Dr. Lewis Sharps, the president and founder of Positive Physicians, says that the current medical malpractice marketplace was slowly shifting from a doctor friendly and soft environment to a hardening market, from which a new medical malpractice crisis would arise. Unfortunately, that possibility is now a reality. The market has dramatically changed. We are now seeing MPL carriers in 2020 demand 10%, 15% and 20% rate increases. This is taking place on the back of the Covid-19 pandemic.

Similarly, the chairman and chief executive officer of The Doctors Company has cautioned for the last three years against rising premiums and diminishing reserves, tightening underwriting standards and selective risk. There are still discounts available, and careful practice profiles are rewarded with premium credits, but a realistic acknowledgement and understanding that the market has shifted is important as you go into this year's renewal.

The Doctors Insurance Agency will continue to work with our selective list of well-run, carefully managed and financially stable insurance carriers. By highlighting practice differences, services and procedures, pointing out which of the physicians are working ten, twenty or more hours per week, and individual claims history, you can expect annual premium reductions or even flat renewals.

We will work with your carrier so your increase in premium is proportionate to the risk the number of doctors and the type of procedures they perform, measured in the context of the state and region where you are practicing..

The Doctors Insurance Agency has survived soft and hard markets, rising and falling premiums, and insurance carriers entering and exiting the market. We continue to work hard advocating for you and carefully documenting your procedures and practices, so that you are fully insured at the right price, with a strong carrier committed to the market.