Massachusetts Attorney General Martha Coakley’s Office quickly announced that it would oppose the rate request, saying that it would cost employers over $40 million collectively. Coakley said she would intervene in the process.
combined ratios when final results for 2009 come through.
performance through favorable loss reserve development.
“Businesses, particularly small busi-
nesses, are already struggling in these
difficult economic times and cannot
afford to overpay for insurance cov-
erage,” said Coakley in a prepared
statement. “We have serious concerns
about the insurers’ proposed rate hike
and the additional strain that it would
put on employers. Businesses are man-
dated under state law to purchase
workers’ compensation insurance, and
they deserve fair rates to ensure that
they can comply without having to
layoff additional workers. Our office
will intervene in the rate proceeding to
protect the public interest and work to
block these unnecessary increases.”
According to S&P, underwriting
profitability for medical malpractice
underwriters increased in 2009 due
to “continued favorable reserve de-
velopment related to prior accident
years,” which S&P said was more
significant than expected. Further,
S&P said that as the market cycle
softens and prices fall, the majority
of medical malpractice writers are
able to improve overall operating
■
Caps on damages in some states in addition to a reduced severity in claims have helped mitigate losses, S&P said. They added that operating expenses and investment income will “clearly influence the prospects of malpractice insurers in the near term,” but that in the soft market the focus on pricing, loss trends and reserve releases also will play a role in profitability.
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The WCRB last requested a rate change in 2008, asking for a 2.3% average rate increase. The parties to the case – the WCRB, the AG’s Office and the Division – reached an agreement to lower rates by an average of 1%. The last rate case, in 2007, resulted in a 16.9% average rate decrease. ■
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NEW YORK CITY — The medical malpractice insurance market is expected to soften in 2010, although some medical malpractice insurers could see profits, according to a recent report from Standard & Poor’s Corp.
Pricing for medical liability coverage is expected to decline more moderately this year, compared to 2008 and 2009, the report indicated.
“As a result of these prices, we see increasing price competition that will likely affect both new business and renewals,” S&P analysts commented in the report. They expect that insurers with a more diversified book will fair better and see stable or better
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