MPL Gets a Cautionary Bill of Health—With a Caveat

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MPL Gets a Cautionary Bill of Health—With a Caveat

According to the Professional Liability Underwriting Society (PLUS), Medical Professional Liability (MPL) continues to evolve in all segments of the market. And although PLUS reports that the MPL market in on track to progress, MPL insurers continuously face the challenges of being able to adequately measure, price, and manage risk.  Complicating these challenges is the growing healthcare industry: by 2020, it’s expected to add more than 4.2 million jobs, according to the US. Bureau of Labor Standards.  As a result, most MPL see this as a market segment ripe with opportunities, but without the right technology to bolster an MPL insurer’s operations, the challenges mentioned above will continue to plague insurers, agents, brokers, carrier staff and providers.

What is the right technology?  In light of the Health Insurance Portability and Accountability Act (HIPAA), the Patient Protection and Affordable Care Act (PPACA) and even the more recent actions around tort reform, the right technology is first and foremost software that uses a secure, cloud-based transmission to facilitate the accurate processing of data. In fact, access to secure data is a mandate; because a breach could cost an insurer its business.

Second, it must embrace and understand emerging technologies that are coming out of the medical field, such as wearables, as well as the most modern, state-of-the-art medical practices currently in force.  This requires policy administration software that, by its nature, includes checks and balances against possible errors.  This software should also tie in to a superior CRM function, so that the insurer can maintain the utmost in policyholder customer service.  And whether the policy is sold as occurrence or claims-made coverage, this CRM function is invaluable, because customized, accurate and reliable communication is so critical during the claims process.

But back to underwriting: the need to have solid underwriting practices in place can’t be overstated, because overlooking certain exposures can result in costly errors. These practices should include exhaustive education on the nature of each risk, and logic-based underwriting software that accurately manages the various “what if’s” within an application.

An MPL insurer also needs to be able to access policyholder data, integrate, and analyze it to enable improved reporting (especially during audits and litigation management phases of a claim) and transparency, as well as to act on the insights created in order to improve performance.

Finally, replacing manual processes with a suite of software tools that enables the MPL insurer to better manage policyholder information that comes from disparate functional business units (accounting vs claims) can be a salve to the wounds of the challenges stated above.