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Social inflation increases med mal losses: Study

Posted On: Jan. 23, 2023 1:06 PM CST

med mal

In the decade ended in 2021, between $2.4 billion and $3.5 billion, or 8-11%, of all medical malpractice losses incurred by physician-focused insurers stemmed from social inflation, says a study issued by a medical malpractice insurer.

The evidence of social inflation in the physicians’ medical malpractice marketplace, though, is not as dramatic as in other lines of business such as commercial auto liability, according to the study sponsored by The Doctors Co., based in Napa, California, which was conducted by Westchester, Illinois-based Moore Actuarial Consulting LLC.

The study says “states that cap noneconomic damages reduce” social inflation’s impact. 

Those “that relax caps or remove them are likely to realize sharp rises in claim severity as well as a change in the variety of medical malpractice claims.”