A California-based consumer group has called for an investigation of accounting practices that it believes have inflated medical malpractice losses in the interest of charging higher premiums.
The Santa Monica-based Foundation For Taxpayers and Consumer Rights said in a report that the "incurred losses" that medical malpractice insurance companies initially reported for policies in effect in each of the years examined were, on average, 46 percent higher than the amount the insurers actually paid on losses.
"If historical loss inflation is any indicator of current trends, insurance companies overstated loss projections by $15 billion between 1995 and 2003," the report said.
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