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Study: Social inflation causes up to 11% of medical malpractice losses

The Doctors Company determined that social inflation is a key driver of higher medical malpractice insurance rates.

By PC360 Staff | January 26, 2023 at 10:45 AM
The trend known as 'social inflation' reflects a societal shift in the ideas about who is best placed to absorb risk. In general, social inflation drives higher insurer claim payouts and loss ratios. (iStock) The trend known as ‘social inflation’ reflects a societal shift in the ideas about who should absorb risk. In general, social inflation drives higher insurer claim payouts and loss ratios. (iStock)

Social inflation accounted for between $2.4 billion and $3.5 billion of all medical malpractice losses between 2011 and 2021, according to new research released by The Doctors Company, the largest physician-owned medical malpractice insurer in the U.S.

“Our research shows that the pace of settlements larger than $1 million has accelerated, and large settlements are a significant driver of social inflation,” Robert E. White, Jr., president of The Doctors Company parent corporation TDC Group said in a prepared statement. The research further indicated that the amount of medical malpractice losses attributed to social inflation during the study period accounted for between 8% and 11% of all losses in that vertical.

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