Professional liability insurance corruption

Continuing from the last post, the last company I worked with was a start-up originally owned by a capital investment company, one that was part of the banking crisis previously mentioned. Their strategy was to sell a bunch of policies fast with minimal underwriting standards, often ignoring bad risks for fast growth and then sell off the company before the losses caught up with them. They knew the losses due to claims would be fast and furious so the only way they could stay ahead of them was to continue the process of writing more and more bad risks to generate more premium.  I was continually pressured to write bad business knowing the losses would exceed premiums and I refused. I was likely soon to be fired for this, as were two upper level executives before me. I retired before they could get rid of me.

After 5 years the losses caught up to them so that loss ratios were around 100% of premium (loss ratio). Before losses could exceed premiums they sold out to a major insurance company that failed to do its due diligence, being enamored by the quick rise in sales and believing it would continue. I didn't follow the story since I quit shortly after the new company took over. My guess is that they instituted their more sensible underwriting standards and had to handle the ever rising loss ratio on the previous bad risks, as well as nonrenewing a large percentage of those bad risks to cut their losses. It likely took that company several years to recover from buying that disastrous company, if they recovered at all.