Dynamics of the Market for Medical Malpractice Insurance |
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| Authors: | Faith R Neale Kevin L Eastman† Pamela Peterson Drake‡ |
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| Institution: | Faith R. Neale is at the University of North Carolina, Belk College of Business, Department of Finance, 9201 University Way Boulevard, Charlotte, NC 28223-0001. She can be contacted via e-mail:;. Kevin L. Eastman is at the Georgia Southern University;. Pamela Peterson Drake is at James Madison University. |
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| Abstract: | Public attention has been directed recently at the market for medical malpractice insurance, yet disagreement persists over whether this market has changed and, if so, what has caused this change. In this study, we examine factors that affect the market for this insurance, including the growth in premiums, losses, and investment earnings, and loss variability. Our analysis suggests that there was significant deterioration in the market for medical malpractice insurance beginning in 1998 and culminating in 2001. We conclude that insurers' losses are the primary driver of the market deterioration during the period 1998 through 2003. |
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