Mercator Risk Services | Medical Services

E&O: Errors & Omissions

Medical Services

The medical services segment is growing and provides significant premium opportunity. The medical industry has been undergoing significant change in the last decade, and the medical malpractice insurance market has responded accordingly. Much of the change in the medical industry has been driven by managed care initiatives and the medical communities response to it.

On top of this change is the deteriorating loss experience of medical malpractice insurers and the resulting recent tightening insurance market. With the tightening market and changes driven by managed care, some medical risks are being forced into the specialty lines market. We are seeing medical services accounts and Mercator Risk Services Inc. ("Mercator" or "Mercator Risk Services") can provide assistance.

The tightening medical malpractice insurance market is manifesting itself in a number of different ways:

Increasing prices
Tighter underwriting criteria
Insurer withdrawals
Restricted terms and conditions

Tighter underwriting by traditional medical malpractice underwriters is pushing "marginal" accounts into the specialty lines market, while insurer withdrawals are putting whole books of medical accounts into the market. Restricted terms and conditions also provide an opportunity for writing a new account. For example, certain non-physician medical professionals may have difficulty getting full prior acts coverage or adequate limits for their practice.

Besides the large commercial writers and small medical malpractice insurers, the health care market is served by a handful of specialty writers. Mercator Risk Services has access to a number of markets that will entertain risks that are no longer insurable with standard and traditional insurers. Most medical services fit into this area.

What are medical services? We define medical services as non-physician medical professionals or facilities. These accounts typically require medical malpractice insurance or similar professional liability coverage including bodily injury coverage. This segment of the medical industry has been growing rapidly, in part driven by managed care initiatives. For a non-exhaustive list click here for medical services examples.

Medical Malpractice or Professional Liability Insurance

Medical malpractice insurance is professional liability insurance, sometimes called errors and omissions or E&O insurance, for medical professionals or medical organizations. This coverage is available from a number of specialty lines insurers. Coverage and pricing varies greatly depending upon the type of professional, the specific medical services provided and location.

Coverage is typically provided on a claims-made basis. Limits and deductibles vary with the size and type of insured organization, but generally start at $1.0 million.

Examples:

Mercator has provided proposals to a wide range of medical service accounts, including the following:

Distressed Podiatrist - This account was a podiatrist with recent claims frequency. Although the claims were minor in nature, the insurer non-renewed due to tightened underwriting criteria. Mercator provided a proposal, including full prior acts, to replace the expiring coverage.

Nursing Registry - This nursing registry account, located in the Midwest, had a difficult time securing reasonable renewal terms due to the growth of their business and the changes in the medical malpractice market. We were able to provide several alternative proposals for this account.

Hyperbaric Center - Hyperbaric oxygen therapy is a treatment that uses pure oxygen to speed and enhance the body's natural ability to health. A group of hyperbaric technicians had formed a center and needed professional liability coverage. Mercator offered a solution to their coverage needs.

Mercator Risk Services provides coverage for a wide range of medical professionals and medical service facilities. Please let us know your client's needs and we will provide you with information and assistance with your particular situation or account, and professional liability coverage.

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