Insurer seeks higher malpractice rates


The insurance company that writes medical malpractice policies for 80 percent of the state's individually insured physicians is seeking permission to raise its premiums.

Medical Mutual Liability Insurance Society of Maryland has filed a request with the state Insurance Division to increase premiums for its malpractice coverage 8 percent for all classes of physicians combined, Raymond Yow, the company's chairman, said yesterday.

Samuel Penn, spokesman for the Insurance Division, said the request by the Hunt Valley-based company, which underwrites about 5,500 medical malpractice policies and paid out roughly $35 million inclaims in 1990, would be subjected to "a pretty extensive review on our part."

Dr. Yow said he expects to hear from the Insurance Division in about 60 days regarding the increase, which would go into effect Jan. 1. "The 8 percent increase represents an effort to keep the company in a proper fiscal position," he said.

The last time the company raised its premiums was in 1987, a 24 percent increase, Dr. Yow said.

David Murray, president of Medical Mutual, said the company had experienced an increase in losses from policies held by physicians who are general practitioners and internists.

Overall, he said, "we're seeing both an increase in the average costper case, plus an increase in the numbers of cases coming in. We're opening on average about two new cases per day. Our pending inventory [of cases] is approximately 1,000."

The average price of a policy with Medical Mutual is $12,000 a year, Dr. Yow said, but certain high-risk categories of physicians pay considerably more. Obstetricians, for example, pay an annual average statewide of $64,000 in premiums.

Non-profit Medical Mutual was created by the General Assembly in 1975 because insurers had stopped writing medical malpractice insurance in Maryland. The company had a virtual monopoly on the state market until 1988, when New Jersey-based Princeton Insurance Co. also began to write malpractice policies.

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