Aggregate direct written premium for the composite of medical professional liability (MPL) specialty writers continues its decline from a high in 2006 of $6.8 billion to $5.1 billion in 2014, a 26% decrease. Six months into this year, this trend is continuing, with direct-written premium down 4.7% from the same period in 2014. Despite the decline in net premium, robust competition, and historically low investment yields, MPL specialty writers continue to be profitable and continue to increase surplus levels. Net income for this composite is projected to approach $1 billion in 2015. But in the face of these positive overall results, pretax calendar-year underwriting and investment income are trending downward. Milliman consultants Brad Parker and Chuck Mitchell provide some perspective in this article.
This article was originally published in the September 2015 issue of the Medical Liability Monitor.
If the historical relationship between first-quarter and year-end financial results holds, medical professional liability (MPL) writers should be in store for another profitable year. First-quarter direct-written premium declined for the ninth consecutive year, falling to $1.8 billion. The 4.7% decline from the first quarter of 2014 is the largest single-year percentage drop since 2011 and is a full point higher than the average annual decline of 3.7% from 2006 to 2015. First-quarter 2015 development fell in line with that of the past two years. Milliman consultants Brad Parker and Chuck Mitchell provide some perspective in this article.
This article was originally published in the July 2015 issue of the Medical Liability Monitor.
There were no distress signals for medical professional liability writers in 2014, and the year adds to what has now become more than a decade of continuous profitability. Direct written premium declined in 2014 for the eighth straight year. The total is down 28% from its high of almost $7.1 billion in 2006. And last year represents the 11th consecutive year of positive operating profit. Milliman consultants Brad Parker and Chuck Mitchell provide some perspective in this article.
This article was originally published in the April 2015 issue of the Medical Liability Monitor.
Medical professional liability (MPL) specialty writers are continuing to benefit from large redundancies in prior-year response levels as they have for several years. But a not so subtle transformation has emerged in the past few years. That transformation is that reserve runoffs are no longer bolstering the profit level. In fact, it could be argued that reserve runoffs are responsible for the profits as a whole. Milliman’s Brad Parker and Chuck Mitchell provide perspective in this article.
The article was originally published in the Medical Liability Monitor.
Based on the collective financial results of 81 insurers specializing in medical professional liability (MPL) coverage, another good year appears to be in the offing for 2014, even as profit margins will likely decline relative to the levels seen in recent years. Pricing pressure continues to be fueled by increasing surplus levels and the desire to maintain exposures against increasing competition and the potential migration of physicians to self-insured employment settings. The largest remaining uncertainty lies in the likelihood that prior-year reserve releases can be sustained to the extent observed in recent years.
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The article was originally published in the July 2014 issue of the Medical Liability Monitor.
The medical professional liability (MPL) market has sustained favorable financial results again in 2013. This article reviews the 2013 results overall, attempts to glimpse what the year-end results might have in store, and works to detect changes in the current trends that continue to produce stellar financial results for the MPL segment of the insurance industry.
MPL specialty writers, as a whole, enjoyed yet another outstanding year financially. Though the continuation of these outstanding financial results is unsustainable long-term, there is still no clear indication from the year-end 2013 financial statement data that suggests these trends are subsiding.
This article was originally published in the April 2014 issue of the Medical Liability Monitor.