Medical malpractice claims are becoming more expensive, more volatile, and more consequential, even as overall claim frequency has decreased, driving up malpractice costs and rate pressure.
Actual medical malpractice claims frequency has declined from historic levels. In 2025, claims frequency was approximately 4.6 percent, down from 7.5 percent in 2016 and well below the roughly 17 percent average observed between 1991 and 2005. While physicians report fewer lawsuits than in the past, medical malpractice insurance is influenced by both the frequency and severity of claims. Although the number of claims has declined, the claims that do occur cost significantly more, increasing insurers’ costs and reshaping expectations for future losses.
The most severe claims are driving pressure
The largest malpractice verdicts continue to rise. The average of the top 50 medical malpractice verdicts increased from $32.6 million in 2022 to $48.5 million in 2023, $51 million in 2024, and $50 million in 2025. At the same time, the number of malpractice payments exceeding $2 million reported to the National Practitioner Data Bank (NPDB) has increased more than tenfold since 1990. In NPDB data, the average physician payment reached approximately $514,000 in 2025, about 20 percent higher than in 2022.
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Medical malpractice is also a long-tail line of insurance, meaning claims often take years to fully develop and resolve. In many cases, it can take three to five years before insurers can determine whether rates for a given policy year were adequate. When severity trends accelerate through larger settlements, indemnity payments, and nuclear verdicts, pressure can build even during periods when claim frequency remains low.
A changing medical liability environment
The medical professional liability landscape has evolved significantly. Once largely focused on individual physician coverage, the market now supports increasingly complex health care systems, integrated delivery models, and larger physician groups. As medicine has become more interconnected across teams, facilities, and care settings, liability risks have also become more complex. Health care organizations and insurers have responded with more sophisticated analytics, expanded risk management resources, and long-term claims strategies.
At the same time, advances in medicine have increased patient expectations, even in complex and high-risk cases where outcomes remain uncertain. Malpractice exposure is shaped not only by clinical care but also by how outcomes and damages are evaluated within the legal system. Large jury verdicts continue to influence settlement expectations, even though approximately 93 percent of malpractice claims do not reach trial.
Social inflation and nuclear verdicts
Social inflation, the gap between ordinary economic inflation and actual growth in claim costs, continues to influence medical liability trends. Between 2014 and 2020, general U.S. inflation increased approximately 15 percent, while the average paid malpractice claim reported to the NPDB increased approximately 42 percent.
Actuarial research estimated that social inflation added between $2.4 billion and $3.5 billion, or approximately 8 to 11 percent, to losses for physician-focused insurers during the decade ending in 2021. Updated analysis for the decade ending in 2024 places that estimate closer to $4 billion. The years from 2022 through 2024 were particularly significant, with actual losses estimated at approximately $1.8 billion higher than expected.
This has coincided with the rise of nuclear verdicts, generally defined as awards exceeding $10 million. Verdict tracking data identified 70 medical malpractice verdicts exceeding $10 million in 2023, 52 in 2024, and 60 in 2025. While verdicts of this size remain uncommon, their impact extends beyond individual cases by influencing litigation strategies, settlement expectations, and the broader liability environment.
What this means for physicians and patients
Higher claim severity contributes to increased premiums, greater financial uncertainty, more defensive medicine, and additional pressure on physician practices, hospitals, and health care systems. Fair compensation for injured patients remains essential, but rising volatility and unpredictability can also affect affordability, access to care, and long-term system stability, particularly in higher-risk specialties and underserved areas. That is why discussions surrounding tort reform, legal predictability, and transparency in third-party litigation financing increasingly extend beyond insurance economics and into broader concerns about health care affordability and access.
In this environment, physician-owned insurers continue to play an important role through proactive risk management, patient safety initiatives, informed advocacy, and long-term alignment with clinical practice. That alignment helps support fair liability standards while protecting physicians, patients, and the stability of health care delivery.
This essay is cited in the KevinMD record on medical malpractice.
Robert E. White, Jr. is president, The Doctors Company.
Founded and led by physicians, The Doctors Company is relentlessly committed to advancing, protecting, and rewarding the practice of good medicine. The Doctors Company helps hospitals and practices of all sizes manage the complexities of today’s healthcare environment—with expert guidance, resources, and coverage—and is the only medical malpractice insurer with an advocacy program covering all 50 states and the federal level. The Doctors Company is part of TDC Group, the nation’s largest physician-owned provider of insurance and risk management solutions. TDC Group serves the full continuum of care.
