Citation

Viscusi WK, Born P. J. Legal Stud. (Chicago) 1995; 24(2): 463-490.

Copyright

(Copyright © 1995, University of Chicago Press)

DOI

unavailable

PMID

unavailable

Abstract

This article examines the effect of the liability reforms on medical malpractice insurance over the 1984-91 period. This is the first study to use data by firm and by state for every firm writing medical malpractice insurance over that time period. The liability reforms increased insurance profitability (that is, decreased the loss ratios), where the main mechanism of influence was through decreasing losses. The quantile regression estimates imply that the greatest effects of liability reform are on the most unprofitable firms and that the effect is not uniform across the entire market. This pattern is consistent with the other principal finding, which is that damages caps appear to be most influential.