New Hampshire regulates liability rates

New Hampshire's medical liability market is not competitive, and rates will be regulated by the state insurance department for the next year, the insurance commissioner has ruled.

Commissioner Roger Sevigny made his decision in October after a public hearing was held earlier this year to discuss the state's professional liability insurance market. Before the ruling, insurance companies were operating under what is known as a competitive market structure, in which they did not need approval for rate changes.

Research presented during the public hearing, however, showed that the top four liability insurers for physicians controlled 95% of the market. The rates of some of the smaller companies also tended to follow the market leader, said David Withers, property casualty actuary for the New Hampshire Insurance Dept.

"All [the commissioner's decision] means is the filing system changes to a prior approval system," Withers said. "We could disapprove a rate for being excessive."

Officials at ProMutual Group, a Boston-based liability insurance company that focuses on New England, said in a company statement that they were disappointed with the ruling. But the company said it "remains committed to its New Hampshire policyholders and pledges to continue offering security and peace of mind" to doctors in the state. ProMutual's affiliate, ProSelect, ranks second in terms of policies written in New Hampshire.

The state is considered by the AMA to be one of 23 showing signs of a medical liability crisis.

Medical Liability Monitor, which released its annual rate survey in October, reports information from two companies, Medical Mutual Insurance Co. of Maine and ProSelect, writing policies in New Hampshire. The companies' rates for internists, general surgeons, and obstetrician-gynecologists are increasing between 17.5% and 48% for 2006.

To extend the regulation period beyond one year, Withers said, the department would need to hold another public hearing to review the market.