The prognosis for the financial health of medical malpractice insurers seems cautiously optimistic, despite continuing economic uncertainty and a range of challenging underwriting conditions.
No company or sector has been unaffected by the economic downturn which saw U.S. stock markets lose 28 percent of their value in the second half of 2008. Medical malpractice insurers are seeing the implications along with the property-casualty insurance market.
The p-c market as a whole incurred investment losses of approximately $25 billion in the third quarter of 2008, and an additional $35 billion in the fourth quarter. On a percentage basis, these figures translate into an overall loss of 4.1 percent of the average surplus for the third quarter, and another 5.9 percent of the average surplus for the fourth quarter.
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