Claims made versus current professional liability.

Abstract

Certain classes of insurance, such as professional liability insurance, have been targeted for substantial price increases or changes in the manner policies are written as carriers shift their portfolios to more profitable industries. In 1979, when interest rates were soaring, the industry cut premium prices to attract policyholders. Later, when interest rates dropped, the shortfall left the industry with insufficient return on their investments to compensate for reduced premium income.