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Best’s Market Segment Report: U.S. Medical Professional Liability Segment’s Profitability Buoyed by Net Investment Income

Premium growth for AM Best’s medical professional liability (MPL) composite moderated to 3.6% in 2023, but overall financial results were buoyed by favorable net investment income, according to a new AM Best report. The premium growth was spurred by price firming following a prolonged period of soft market conditions and challenging industry dynamics that dampened demand.

The new Best’s Market Segment Report on the U.S. MPL segment noted that improved underwriting results stalled last year, driven in part by rising loss adjustment and other underwriting expenses. MPL insurers continue to face many of the same headwinds that they have in recent prior years, including a potential rise in claims costs due to social inflation and erosion of tort reforms, as well as the growing complexity of medical care. MPL carriers also continue to work to mitigate ongoing challenges such as escalating burnout rates, staffing shortages, and further growth of alternative care providers, all of which could have a negative impact on claims frequency.

“These headwinds, coupled with changes in tort reform, social inflation and continued rising claims severity could impede the segment’s progress,” said Sharon Marks, director, AM Best. “But these issues are also expected to help focus and maintain the MPL segment’s attention on premium adequacy, underwriting discipline, and prudent reserving.”

AM Best revised its outlook on the U.S. MPL insurance segment to stable from negative in November 2023, citing improved rate adequacy, the diminishing impact of pandemic-related exposures, persistently redundant loss reserves, higher reinvestment rates, and improved overall returns.

To access this market segment report, please visit

A panel of AM Best analysts and leading market executives will discuss the MPL segment in a complimentary market briefing scheduled for Wednesday, May 1, 2024, at 11:00 a.m. (EDT). To register, or for more information, please go to

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit

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