Premiums reducing, claims down – what’s happening?
This year, the majority of our members will receive an average reduction in their premium of between 10% and 15% on renewal, with some higher or lower than this, based on the claims experience of their speciality.
The reductions in premium are on the amount invoiced last year, after allowing for the 10% Renewal Bonus our members received, representing significant savings across the last two years.
One of the key reasons why we can offer these reductions is that in the last few years our claims results have improved significantly. Claims frequency is reducing and our average cost of claims is stable.
We believe there is a real correlation between these results and our strong focus on risk management. Members are now benefiting from this via reduced premiums.
MIGA outperforms the industry
The following graph compares the trend in MIGA’s claims frequency relative to industry data reported by the ACCC . The graph shows that since 2003 MIGA’s claims frequency has reduced by a considerable amount, and has improved by more than the whole industry (the industry data in the graph includes MIGA). This apparent outperformance by MIGA follows the introduction of our risk management (IRM) Program in 2002/03.
This is our best indication yet that MIGA is seeing a different outcome with claims trends when compared with the whole industry and we believe it’s our strong focus on risk management that is driving this.
Over the last 9 years we have developed an extensive risk management resource base for our members. Not only do we offer doctors access to an industry leading risk management program, but we also provide a range of other risk management educational material such as Risk Resources, our on-line package of risk management material and fact sheets designed to help doctors in their day to day practice. In addition, we provide members with significant information about risk management through our Bulletin articles and information available via our website.
Since its inception, we have had over 17,000 attendees at MIGA workshops (many doctors have attended multiple workshops).
Is our IRM Program making the difference?
We believe it is!
For some time now we have had in place with our actuaries an analytical framework against which we can assess our claims data on an annual basis to monitor the ongoing impact of the IRM Program.
We have the claims experience of more than 3,000 doctors to use in this assessment.
A reduction in claim frequency is where we have seen the greatest impact of our risk management program. Our analysis shows that:
- Our IRM Group of doctors have seen a decrease in claims frequency of up to 50% since 2005. This group represents those who have been insured with MIGA for at least 5 years and completed the Program in at least 2 of those years (i.e. have achieved 10 points)
- In contrast, the claim frequency for our Control Group has been stable across this time with a small reduction in 2009 only. This group represents all other doctors who were insured with us across all 5 years who were not in the Program at all, or only for 1 of those years.
We understand that the size of our database may limit its reliability in a pure statistical sense.
What is indisputable however is that MIGA is experiencing an improvement in our claims results over and above the balance of the industry, and we can see that it has been driven more by those doctors who have completed the IRM Program than those who have not.
What does this mean for the future?
When premiums and claims start reducing, it’s tempting to forget about risk management. We understand that the time involved in doing risk management may be an issue for some doctors.
We hope doctors insured with MIGA can see that the time and effort is worth it with the reductions in premiums we have offered over the last 2 years.
We strongly encourage all members to maintain their focus on risk management and complete the IRM Program in the next year, as you will directly benefit from it.
We are committed to delivering further premium reductions to our members in the future provided our claims costs continue to reduce.
By Mandy Anderson
Chief Executive Officer
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