This article examines what the third quarter financial results of medical professional liability (MPL) specialty insurers indicate for year-end results. Based on data compiled by SNL Financial, this article compares the composite financial results of this group as of Sept. 30, 2012, to composite results at year-end over the past decade and discusses what financial results might look like for MPL writers as a whole as of year-end 2012.
In 2012, composite results show a continuation of the familiar financial trends of recent years. The composite premium volume continues its descent. At the same time, coverage-year combined ratios are inching upward due in part to depressed underwriting results in light of softening rate levels. Lower bond yields are reflected in lower investment income, putting further pressure on composite operating margins. Again, however, the bright shining light in the face of mostly negative trends is the favorable development of historical claim reserves, which continues to boost the calendar-year results and expand the composite capital levels.
This article was originally published in the December 2012 issue of the Medical Liability Monitor.