What drives insurance rates has little to do with claims — and has everything to do with the profitability of the real business that insurers are in: investing in stocks, bonds and real estate – according to an article in the Miami Herald by Edward Wasserman about the causes of increases and decreases of insurance premiums. Insurance companies invest a portion of the money obtained from premiums in interest rate sensitive assets. Interest rates are a significant factor determining insurance company profitability which increases or decreases when interest rates increase or decrease.
The Pop Tort – with expressive commentary, and humor The Pop Tort provides the truth about insurance companies, large corporations, the health care industry, drug companies, big tobacco, oil and chemical conglomerates.
Medical Malpractice update at The Pop Tort.
An Insurance Journal article reported that a study by Conning Research and Consulting, Inc. shows that the medical malpractice insurance industry will be profitable again in 2006. The study found that the frequency is declining and investment income is on the rise. “Medical Malpractice: New Opportunities Emerging? Or the Eye of the Hurricane?” is available for purchase from Conning Research & Consulting by visiting the company’s Web site at www.conningresearch.com.
Liability costs to American businesses are the lowest in a decade according to the 2000 Risk and Insurance Management Society and Ernst & Young, LLP Benchmark Survey! In 1992 liability costs for businesses were $8.30 per $1,000 of corporate revenue. Costs have declined every year and by 1999 costs plummeted 37.35% to $5.20 per $1,000 of corporate revenue! According to the report the reductions represent both lower insurance premiums and lower retained losses. According to the 2001 RIMS Benchmark Survey, produced jointly by Ernst & Young LLP and RIMS (2002), by the year 2000, costs declined again to $4.83 per $1,000 of corporate revenue! See Americans for Insurance Reform – Fact Sheet – Response to American Insurance Association Attack on Premium Deceit
How Big is the Price Tag for Excess Auto Injury Claims? – Rand Institute.
The Insurance Journal reports medical malpractice payments grew only 4% in 12 years from 1981 to 2003, but doctors are still afraid. Health Affairs Journal founding editor John Iglehart, stated “Yet these concerns seem out of proportion to what’s really happening with malpractice suits – and so, for that matter, are the sharp increases in malpractice premiums.” Read the June 1, 2005 Insurance Journal article
Insurance Industry Admits: Don’t Expect “Tort Reform” To Reduce Insurance Rates. In a startling admission, the American Insurance Association (AIA), a major insurance industry trade group, says lawmakers who enact “tort reform” should not expect insurance rates to drop.
Medical Malpractice Caps Fail to Prevent Premium Increases, According to a Weiss Ratings, Inc. study. This in-depth article is entitled “The Impact of Non-Economic Damage Caps on Physician Premiums, Claims Payout Levels, and Availability of Coverage. The article states “But most insurers continued to increase premiums at a rapid pace, regardless of caps… These counter-intuitive findings can lead to only one conclusion: There are other, far more important factors driving the rise in med mal premiums than caps or med mal payouts.”
A medical doctor testifying as an expert witness in a medical malpractice trial who suggested to a jury that he had reviewed data that he had, in fact, not reviewed, was fined for deliberately deceiving jurors. (November 19, 2004)
Doctors Agree Medical Errors Are Killing People, But Are Not in Favor of Solutions. According to the NY Times, “Although studies have demonstrated that various technological and procedural changes can cut the error rates in hospitals, the practicing physicians were lukewarm toward many reforms.”. Click here for the full article.
Drugmakers wrongly file patent challenges against generic drug manufacturers to delay generic drugs from reaching the market. See The Truth About Drug Companies. On behalf of consumers, small businesses, and drug manufacturers, trial attorneys filed a class-action antitrust suit against one drug company, SmithKline claiming that SmithKline filed patent challenges against generic drug manufacturers to delay the manufacture of generic versions of Paxil. Trial lawyers won compensation for SmithKline’s overcharging and successfully stopped SmithKline’s delays. The judge even applauded “the high caliber of plaintiffs’ counsels’ work in this case.”
Americans for Insurance Reform “Protecting Rights, Not Wrongs” Big Insurance companies want to make their problem, your problem. Read the true facts about insurance companies and premiums.
Do you think there are too many lawsuits? According to the Department of Justice Bureau of Justice statistics, the number of federal tort trials fell by almost 80% from 1985 through 2003.
Think juries are out of control? Think again! US Dept of Justice Bureau of Justice Statistics (BJS) for Tort Trials and Verdicts in Large Counties (also see) show that punitive damages were awarded by a judge in 7.9% of cases tried by the judge without a jury, compared to only 3.2% of cases tried by juries. The median punitive damages award from judges was $75,000 compared to $27,000 from juries. According to BJS Civil Justice Statistics, in 49% of jury trial cases, the jury found in favor of the plaintiff awarding a median total award of only $35,000, while plaintiffs won in 62% of bench trials (tried by the judge without a jury) with a median total award of only $28,000. Think that’s a lot of money? Let me know after you suffer an injury such as a back injury, due to someone else’s negligence that will change your life and cause untold expense for the rest of your life. For instance, having to pay a gardener to mow and fertilize your lawn because you can’t do it yourself anymore. But juries are important to a free society. Thomas Jefferson, when he spoke at his first inaugural address on March 4, 1801 of the nation’s guiding principles stated, “Freedom of religion; freedom of the press; freedom of person under the protection of habeas corpus; and trial by juries impartially selected. These principles form the bright constellation which has gone before us, and guided our steps through an age of revolution and reformation.”
On the Rare Occasions When A Jury Does Award Too Much – the “checks and balances” of the court system work to correct ultra high verdicts. What the media never prints is that high verdicts are almost always reduced by the trial judge and if not by the trial judge, then by several judges in an appellate court. The trial judge in Leona’s Helmsley’s bias case reduced the award against her from $11.7 million to $554,000. He ruled that the plaintiff was not entitled to $1.1 million in economic damages, and the $10 million in punitive damages was excessive. Unfortunately, verdicts awarding ridiculously low amounts or nothing at all are rarely, if ever, increased.
Why people don’t like lawyers, at least defense lawyers! – A True Story About the Behavior of Lawyers.
Legal Myths: Hardly the Whole Truth – USA Today article about phony law suits reported as real in email, on TV, and by politicians.
Email Scam: Stella Awards “Six real lawsuits showcase the need for tort reform” – A list of phony lawsuits (and proof that they’re false), emails sent to gain support for tort reform. (From Snopes.com)
Email Hoax: “Lawyer purchased a box of very rare and expensive cigars, then insured them against fire” – This has been spread around the internet in various versions. This is a known email hoax/scam. The story is not true and there is no Criminal Lawyers Award Contest or Criminal Lawyers Darwin Award Contest. This scam originally began without the person being a lawyer and that was also false. Then someone added the lawyer into the story.