Medical Professional Liability
Malpractice Coverage News Room

Kentucky Department of Insurance Recommendations concerning Medical Professional Liability Insurance.

Kentucky Department of Insurance
Medical Malpractice Insurance Recommendations
January 7, 2003

The medical malpractice insurance market in Kentucky continues to harden. While an adequate number of carriers are offering coverage, the cost has increased and finding coverage is requiring additional effort on the part of providers. In addition, underwriting has become stricter with companies looking much more closely at the risk being assumed. Providers, particularly those in high-risk specialties such as obstetrics/gynecology, neurosurgery and emergency medicine, as well as those with past claims history, are reporting large premium increases.

Following months of study, the Department of Insurance (DOI) is announcing an immediate course of action and a three-part recommendation for consideration.

Immediate Action
Effective January 15, 2003, all companies writing medical malpractice coverage in Kentucky will be required to file their rates with the Department. This is known as "designating" the line.

This will not add an undue burden of regulatory constraints to companies and will not interfere with competition or participation in the marketplace.
Rates for designated commercial lines are required to be filed within 15 days after the first use. However, if there is a change of more than 25 percent from the then-existing rates for any classification of risks in any rating territory within a 12-month period, the rates must be filed for prior approval before being used. In order to receive approval, a carrier will need to submit actuarial justification of rate need. If this justification is provided, approval will be granted.

This move will allow for closer monitoring of the market by DOI to assure that rates are justified by insurers' costs, claims and other expenses. In addition, improvements will be made to reporting mechanisms to produce more accurate, useable data regarding medical malpractice claims and costs.