Markel Corp. (NYSE:MKL) Q3 2016 Earnings Conference Call - Final Transcript
Nov 02, 2016 • 09:30 am ET
about when you look at the pricing development in the recent past, kind of how things have been emerging? Any reason we should look differently at your prospects in coming periods?
Mark, it's Richie. I don't think so. We've obviously talked a lot about medical. We believe we're on top of that. Just as a backdrop, keep in mind, pricing has been coming off for the last few years. And as a result I would suggest there's not as much margin in the business we're putting on the books today as it was a few years ago. We all have to remain mindful of that. And we're talking to our underwriters about those sorts of things. But other than what we saw in medical this year, no. The trends seem pretty consistent.
On the medical, I think you had addressed the legal environment more broadly and said you weren't seeing meaningful changes. When I think about correctional facilities, for instance, I wouldn't think of that as a very volatile market in terms of how many prisoners are suing or I'm not sure who initiates the actions in those cases. Was there some sort of precedent that was set that spurred more activity? Or this is just something that --?
Well, yeah. Two things happened. That has always been a high frequency class, the correctional medical, in that you saw a lot of claims but they tended to settle at no cost or at low cost. And what changed is it appears the plaintiff's bar has sort of recognized that as an opportunity. We've seen some increase in the frequency. But we've seen a decent upon of increase in severity. So a previous person asked are we seeing that happen across our various specialty lines. The answer is no. We're not seeing it happen across specialty lines but we did specifically see that happen in correctional medicine.
And then the other thing that happened, we talked about how the landscape has been changing in healthcare. One of the things that happened is we saw correctional medicine become a bigger part of our medical book. And we're paying attention to that. It was a bad time for it to be a bigger part of our medical book. So those are really the two things that happened there.
Thanks for the detail.
[Operator Instructions] I'm showing no additional questions at this time. I would like to hand the conference back to Tom Gayner for his closing remarks.
Thank you very much for your support and we look forward to catching up with you along the way and we'll talk to you next quarter. Thanks.
[Operator Closing Remarks]