The insurance market is cyclical, and often characterized as being either a “hard” market or a “soft” market, or in the process of transition from one market to another. Currently, the market is transitioning from a “soft” market to a “hard” market.
We have been in a soft market for about the past 15 years. Prices have remained relatively low, despite the annual increases in the Virginia Cap limits of liability. Insurance buyers have seen flexible eligibility guidelines, more easily available coverage, and have had several options from which to choose from.
Insurance companies are paying higher costs to defend claims and are seeing larger settlements and verdicts. For a while, insurance companies were able to absorb increased expenses through their investments and surplus. These costs have risen to the point where many insurers must adjust pricing to adequately cover these increasing expenses. The MSVIA is being advised by some professional liability companies that they will begin making adjustments in pricing or underwriting guidelines.
All of our companies are experiencing these changes to some degree, however each company is unique.
Some general signs of the market hardening include:
Medical Professional Liability (MPL) insurance has been in a Soft Market Cycle since 2005—the longest soft market we’ve experienced. Coverage has been widely available, policy terms relaxed, and priced-based competition common.
In a Hard Market Cycle, insurance becomes less available, policy conditions tighten, and premiums increase.
MSVIA's affiliation with the Medical Society of Virginia and our status as an independent agent means that our most important responsibility is to you, our client. We will assist you in evaluating your coverage for additional discounts or ways to minimize cost, and will help you determine when it is helpful to consider looking at other carriers.
Not a client? Now more than ever, when you are considering options, it is to your benefit to work with an agency that puts physicians first.
If you are impacted by these market forces, we encourage you to consider the MSVIA as a resource by reaching out to us.