The professional liability insurance marketplace in Texas has been extremely volatile the past twenty years. Due to increasingly high claim payouts, many carriers were either driven out of business, or were acquired by other carriers in the late 1990s. By 2002, Texas had reached an all-time low of only three standard markets available for medical malpractice insurance.

In 2003, Texas voters responded to this crisis with approval of a tort reform bill titled “Proposition 12” which places a $250,000 cap on non-economic damages awarded in malpractice suits. Tort reform influenced a sharp decrease in claims activity and the severity of claims payouts, enabling insurance companies to lower premiums. Several carriers were able to re-enter the market, and new carriers were created in the following years. Texas quickly became a very competitive marketplace. Whereas in 2002 there were only three markets in total, by 2010 there were six standard markets which represented approximately 75% of the written premium and the rest of the market share was represented by over 45 professional liability companies.

As in many other states, the Texas marketplace is currently experiencing consolidation. Several insurance companies such as American Physicians Insurance Group (API), Advocate M.D., and Medicus have been recently acquired or merged with larger insurers, in an effort to increase both market share and efficiency. As the consolidation trend continues, the number of competitors will shrink and insurance options may become more limited. In this shifting marketplace, it is increasingly beneficial to seek advice from a large broker like Gallagher, so that physicians can find the insurance best suited to them at the best price.

Texas Claims Trends

In Texas, the average severity of claim payments tended to increase right alongside the national trend until 2002. Since that time, Texas insurance companies have enjoyed the steady decrease on average in claim payments. In 2011, the average indemnity claim payment was $155,693.18 compared to the national average of $303,963. Only two states have lower average indemnity payments than Texas.

Average Claim Payments, by Year Texas vs. USA
Medical Malpractice Insurance Claims - Chart1

Of the 550 claims which resulted in payment in Texas in 2011, only three were large loss claims over $1M. With only .55% percent of all paid claims in the state exceeding $1M, Texas is far below the national average in 2011 at 3.9%. Of these large loss claims, the single highest claim payment in 2011 was $4.95M.

Total Number of Paid Claims, by Year, Texas
Chart2

The frequency of paid claims in Texas also took a sharp decrease after the implementation of tort reform in 2003. Because the average occurrence to settlement time in Texas is 3.9 years (the national average is 4.5 years), this dramatic decrease is not seen until 2006 and 2007. In 2011, 0.93 of every 100 Texas physicians were involved in a paid claim, whereas the national average was slightly higher at 1.3 of every 100 physicians. This ranks Texas fairly low in frequency of physician involvement: #36 of 51 states (District of Columbia included).

Major Insurance Companies

In 2010, Texas had $343,822,917 in total written premium. The leading insurance companies (based on written premium) in Texas are as follows:

Texas Carriers
Medical Malpractice Insurance - Chart3Notes: 1. Based upon data provided by the National Practitioner Databank Public Use file through December 31, 2011 for physicians.

Many of these insurance carriers provide coverage in other states as well as Texas. As a powerful national broker, Gallagher has access to all the above insurance companies for their clients.

Why Partner with Gallagher in Texas?

  • We are the largest provider of MPL insurance to physicians in Texas;
  • We have active relationships with all major insurers, and are the largest broker for most of the carriers we represent;
  • We believe in providing personalized service to our clients – when you call, an expert in Texas medical malpractice insurance will be available to help you;
  • There is absolutely no cost to you for utilizing our services – We are paid via a commission from the insurer that is built into their rates regardless if you choose to utilize a broker;
  • Without broker assistance, a physician is limited in negotiating favorable terms and conditions – Our experts can quickly outline all available options, and ensure the practice is getting the best terms possible;
  • We are the largest provider of insurance products to physicians nationally, bringing unmatched leverage to market relationships;
  • We are part of the Gallagher family, recently named the top Ethical Insurance Broker in the U.S.;
  • We can be your “one stop shop” for all your insurance needs, ranging from employee benefits to general business insurance, as part of the Gallagher team;
  • We are the best in the business within our specialty – Physicians Malpractice Insurance.

Texas Medical Malpractice Insurance Rates - Top 15 Specialties

Undiscounted State Filed Rate Data averages across all territories for $200K / $600K limits

SpecialtyAverage RateMin RateMax RateCount
Family Practice No Surgery$7,172$3,022$13,5838783
Internal Medicine No Surgery$7,581$2,725$15,5258712
Pediatrics No Surgery$7,307$3,047$15,5255303
Anesthesiology$8,547$3,312$16,4664745
Radiology - Diagnostic$8,830$3,842$13,3424439
Emergency Medicine$13,317$5,623$25,7423888
Obstetrics and Gynecology Major Surgery$28,171$13,248$57,6013434
Psychiatry$6,008$2,119$10,1052820
Pathology No Surgery$6,769$2,649$13,5832190
General Surgery$22,099$7,949$57,6012153
Orthopedic Surgery No Spine$18,783$7,734$39,0982104
Ophthalmology Major Surgery$7,891$3,047$15,5251638
Cardiovascular Disease Minor Surgery$10,723$5,034$17,0751490
Neurology No Surgery$8,504$4,324$18,3511361
Gastroenterology Major Surgery$11,877$5,794$30,2131144
* Please note that the above rates are state filed rates. It is not uncommon for Gallagher Healthcare clients to receive up to 50% or more in discounts from state filed rates. Please Request a Quote to receive a custom premium indication.

Rate Range by Specialty

This chart compares the range of possible state filed medical malpractice premium rates by admitted markets and a few Gallagher Select markets broken out by the top 15 specialties in Texas.

Texas Medical Malpractice Rate Range Chart

USA Ranking Map

The map below provides a visual display of the nation and compares what a typical primary care physician might pay compared to each individual state and county. This research is based on the average rate for a single specialty, the most common limits in that state, and the mature claims made premium. The darker the blue, the higher the average premium, see how Texas compares to other states.

Malpractice Rate Heat Map - United States