Medical liability insurers profiting handsomely in wake of Texas tort reform

Three years after tort reform hit the books in Texas, the state's medical liability insurers have lowered premiums somewhat and added enormously to their bottom line, according to a story in the August 11 issue of the Austin Business Journal. The largest of them all -- Texas Medical Liability Trust -- has shown the greatest gains:

The state's largest medical malpractice insurer -- Texas Medical Liability Trust, which is based in Austin -- may have the best post-tort reform success story.

In its 2005 annual report, TMLT detailed how, in just five years since 2001, its surplus has gone from $22.9 million to $203.4 million -- an increase of almost 800 percent. Over the same period, its assets almost doubled, going from $333.9 million in 2001 to $588.7 million last year. During the same time, however, its insurance losses went down by almost half, from $137.2 million in 2001 to $73.2 million last year.

And, the article continues, "Texas' second-largest doctor insurer, Fort Wayne, Ind.-based Medical Protective Corp., is doing well enough that last year it was bought by Berkshire Hathaway Inc., the legendary company run by the world's second-richest man, Warren Buffett."