With so much information available about medical malpractice insurance (much of it produced by insurance companies themselves), trying to find the right policy can be overwhelming.
Medical malpractice insurance is essential to protect your practice, patients, and personal assets, and it’s worth taking the time to make sure you’re getting the best coverage at the best price.
Fortunately for most physicians, malpractice insurance is provided by their employer or the partnership they join. Even with locum tenens, the company or the site you work at will provide coverage or will recommend a carrier for you to purchase a policy from. However, even if you don’t need to shop for malpractice insurance, it is important for you to understand your coverage.
Here are 6 things to look for when evaluating medical malpractice insurance policies.
When reviewing policy options, make sure to choose a policy that has sufficient limits to match the risks associated with your practice or type of work. The amount of coverage you need could vary depending on the work you do.
Does the policy have a deductible? Some policies have no deductible, which is the preferable choice and is often available to individuals without a history of malpractice claims. There are two different types of deductibles that a medical malpractice insurance may have.
A “first-dollar deductible” is the standard type of deductible where the individual needs to pay up to a certain amount before the insurance company will cover costs.
The other type of deductible is called “indemnity-only”, which only requires the individual to pay the deductible if the verdict is unfavorable or the case is settled.
Insurance companies typically offer two types of medical malpractice coverage: claims-made and occurrence-based.
Claims-made policies provide coverage if both the incident occurred and the claim was filed when the policy was in effect.
Occurrence policies provide coverage for incidents that occurred during the policy year, whether the claim is made during that year or not.
Insurance companies will often have maximum amounts they will pay on the insured’s behalf for a specific claim. Depending on the state you practice in, the limit will vary. The dominant limit in most states is the same amount that hospitals require physicians to have. Make sure to look at both the occurrence (one claim) limit and the aggregate (annual) limit.
Choose an insurer with a reputation for financial stability, customer service, and claims handling. Talking to other physicians and reviewing the company’s AM Best rating is a good place to start.
Look into the experience of the insurer. How many years of experience do they have insuring physicians? If the company is financially solvent and has a good reputation, it’s a good idea to go with an insurer who has a lot of experience covering medical malpractice.
As mentioned above, some policies only cover occurrences if the incident and claim were made during the policy year, while others cover claims if the incident occurred during the policy year.
Tail coverage can protect a physician by covering claims that are reported after the policy’s end. It can help avoid liability for claims made once your policy is over if you switch plans.
Any career transition - whether changing practices, switching from a solo or group practice to hospital employee, or retiring - can lead you to switch medical malpractice insurance plans. So if you think a career transition may be a possibility, it’s important to make sure your policy offers tail coverage.
Some medical malpractice insurance policies offer more than just claims coverage. Insurers sometimes offer risk management training, legal support, or assistance with regulatory compliance. Consider if these additional services could be useful to you or your practice and take them into account when considering pricing.
This may go without saying, but pricing is a critical decision maker when selecting the right medical malpractice insurance policy. Your specialty, geographic location, and claims history will affect your premiums, but the coverage and company you choose will also determine the price. Keep in mind that the cost for the premium doesn’t always correlate with the amount of coverage.
Many factors go into selecting the right medical malpractice insurance policy, and it can be an overwhelming process. However, if you take some time to decide exactly what you need, then check the insurer’s reputation, type of deductible and coverage, and pricing, you’ll be on the right track. If you’re unsure of where to start, we at Earned can be a helpful resource for you.
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