What are the reasons for increases in malpractice insurance costs?
Beginning in the late 1990’s, malpractice premiums began to increase rapidly for many physicians, especially in certain states. The U.S. Government Accounting Office reported in 2003 that these increases were due to a combination of several factors: increased losses to malpractice insurers in paying malpractice claims, decreases in investment income of insurers, decreased competition among insurers because a number of insurers left the medical malpractice market or became insolvent, and increased costs of reinsurance, which increased overall costs to insurers.
