Over the last 12 months, the standard professional liability market in Florida has changed dramatically. On 2/20/20, ProAssurance Corporation announced that they would be acquiring Norcal Mutual Insurance Company. Now, 2 years after than announcement, we are starting to see the affects of this change. As of 1/1/2022, ProAssurance rates will be used for new policies issued in Florida.
On average, ProAssurance rates are higher than Norcal rates. This has a direct effect on “tail” costs since the cost of “tail” is a factor of the underlying premium. The ProAssurance to Norcal transition will continue to effect the admitted market and “tail” markets as current Norcal policies are converted to ProAssurance policies starting in 2023.
Additionally, many carriers have taken rate increases or decreased the amount of discounts they apply to the underlying rate. An increase in the physician’s annual premium will have a direct increase on the cost of “tail”. For this reason, it is imperative to obtain multiple quotes for “tail” coverage to avoid over-paying for coverage.
