Liability insurers raise premiums, but payouts remain flat

November 1, 2005

A recent report from the Center for Justice and Democracy is lending credence to physicians' complaints about skyrocketing malpractice insurance premiums, according to Managed Care (8/2005).

A recent report from the Center for Justice and Democracy is lending credence to physicians' complaints about skyrocketing malpractice insurance premiums, according to Managed Care (8/2005). The report, "Falling Claims and Rising Premiums in the Medical Malpractice Insurance Industry," analyzed the performance of the 15 largest insurers and found that they had raised their net premiums by 120.2% between 2000 and 2004, while net payouts for claims increased a mere 5.7%. During the same period, the incurred-loss ratio-the amount that insurers estimated they would pay out in the future divided by the premiums they earned-declined by 25%.