My understanding of Maryland law is that doctors do not have to consent to settle before the insurance company can make a settlement offer, absent specific policy language giving them that right. (I say “my understanding” because I really don’t know the source. It could be the “Law of Ron.” But I think that is right.)
Either way, I think the point is largely moot in Maryland. Med Mutual, who insures most Maryland doctors, seems to require the doctor’s assent to settling a malpractice case. It it not a bad policy – it is a doctors’ owned insurance company. Most doctors pushing Med Mutual to stick its chest out likely have enough coverage. No one is usually so bold with their own assets on the line.
A lot defendant’s malpractice lawyers use this as a faux means of not pursing settlement discussions before a pretrial. But I know we have tried at least one case because the doctor did not want to settle out of fear which we think was out of fear that Med Mutual would drop him.
Anyway, there is a new opinion in Rhode Island that sheds some light on this issue. In Papudesu v. Medical Malpractice Joint Underwriting Association of Rhode Island. In this case, the insurance company paid $500,000 to settle plaintiffs’ wrongful death lawsuit involving a stillborn birth. The doctor objected because he was confident he would win at trial and believed that a settlement would adversely affect his professional reputation and, it what could have been more important, a settlement would cause the cost of his malpractice insurance to go up.
The doctor lost on this policy language: “The [insurance] company may make such investigation and settlement of any claim or suit as it deems expedient.”
You can read the full opinion here.