ROCKVILLE, Md., Sept. 27 – LAWFUEL – The Law News…

ROCKVILLE, Md., Sept. 27 – LAWFUEL – The Law News Network – Independent actuaries with the firm Towers Perrin find that a July 2005 report released by the Center for Justice and Democracy and five other “consumer groups” is incomplete and
unsound. Jay Angoff, an attorney employed by a personal injury law firm,
performed the analysis for the six “consumer groups” and claimed that medical
liability insurers have overcharged doctors and hospitals and accumulated
record amounts of surplus over the last three years. However, an analysis of
Angoff’s report by actuaries James Hurley and Gail Tverberg finds that those
claims are not supported by the data, nor do they pass a common sense test.

Towers Perrin’s comments released today find Angoff’s “analysis is
incomplete and unsound” and his statistics “are:
1) meaningless and unsound in the case of paid loss to written premium
comparisons;
2) materially incomplete, in the case of incurred loss to earned premium
comparisons; or
3) incomplete and taken out of context, in the case of the change in
surplus.”

The Towers Perrin analysis documents that malpractice insurers have lost
money in each of the years 1999 through 2003 even after considering investment
income from their bond portfolios. In 2001, financial results were the worst
in approximately 30 years. Hurley and Tverberg, through a succinct and
thorough review, demonstrate that Angoff’s conclusions cannot be supported by
the facts.

Furthermore, Hurley and Tverberg find that Angoff’s analysis fails the
common sense test in that insurance regulators and analysts do not look at the
statistics that Angoff derives because they are “meaningless, incomplete and
inappropriate to form the conclusions made in the [Angoff] Report. If medical
malpractice is as profitable as implied by the report, more companies would be
competing to write the coverage.”

PIAA President Larry Smarr applauded the actuaries’ comments. “The Angoff
report is a hoax and inappropriately twists numbers to claim that medical
malpractice insurers have increased premiums at a rate more than 20 times the
increase in claims payments. Towers Perrin has taken a critical step toward
setting the record straight and stopping Angoff and these groups from further
misleading the public.”

Mr. Angoff’s report is entitled, “Falling Claims and Rising Premiums in
the Medical Malpractice Industry.”

The PIAA is an association of doctor/provider owned and/or operated
medical liability insurance companies which insure over 60 percent of
America’s private practicing physicians as well as dentists, hospitals, and
other healthcare providers.

Web Site: http://www.thepiaa.org

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