As physicians, having reliable malpractice insurance is crucial to protecting your career and your financial future. Whether you’re just starting out in your medical career or have been practicing for years, understanding malpractice coverage is essential. 

How do you know if you have good malpractice insurance? If it’s lacking, how can you find the right coverage? Let’s look at the key factors to consider when deciding the best malpractice insurance for your needs:

1. Evaluate your current malpractice insurance

It’s important to evaluate your existing malpractice insurance, so you can know if you need to find new, better coverage. You’ll want to make sure it offers adequate protection and aligns with your current practice setting and specialty. Here are a few questions to help assess the quality of your existing policy:

What type of policy do you have?

There are two primary types of malpractice insurance: claims-made and occurrence-based. Claims-made policies provide coverage only if the claim is made while the policy is active. Occurrence-based policies cover any claims made for incidents that occurred during the policy period, even if the claim is filed after the policy expires.

If you have a claims-made policy, make certain it includes tail coverage or be prepared to purchase it separately to protect yourself if you leave your current practice or the policy lapses.

Are the policy limits sufficient?

Another key consideration is whether your policy limits are high enough to cover potential claims. Malpractice insurance policies typically have two types of limits. Per-claim limits have a maximum amount the insurer will pay for a single claim. Aggregate limits have a maximum amount the insurer will pay in a given policy period. This is usually a year.

Do some research to ensure your limits are in line with the average malpractice settlements in your specialty and region. If they’re too low, you could be personally liable for any amount that exceeds that coverage!

What is covered under your policy?

Good malpractice insurance should cover all aspects of your medical practice. Make sure your policy covers the following:

  • Medical malpractice claims- which include allegations of negligence or failure to provide appropriate care.
  • Legal defense costs- including attorney fees, court costs and any other litigation-related expenses.
  • Settlements and judgements- which encompasses any amounts paid to settle a claim or judgement awarded by the court.

Additionally, check to see if your policy covers both direct patient care and any administrative or consulting roles you may take on.

2. Signs you need to shop for new malpractice insurance

If your current malpractice insurance doesn’t meet the criteria outlined above, or if you’ve recently changed practice settings or specialties, it might be time to think about new coverage. Here are some red flags that indicate it’s time to explore other options:

  • Your policy limits are too low for your specialty.
  • Your policy doesn’t offer tail coverage or occurrence-based protection.
  • The premiums are too high when compared to the coverage being offered.
  • Your current insurer has a poor track record of handling claims fairly or efficiently.

3. How to find the right malpractice insurance

Once you’ve decided to look for new coverage, there are things to consider during your search for the right insurance for your practice.

Assess your specialty’s risk level.

There are certain specialties, such as neurosurgery, obstetrics and emergency medicine, which have higher malpractice risks and may require a more robust level of coverage. So, when shopping for a new policy, make sure the insurer offers coverage tailored to your specific specialty.

Shop around for the best rates.

Insurance premiums can vary significantly between malpractice insurers. Take the time to compare quotes from multiple providers. Be cautious about choosing the cheapest option, though. It’s vital to make sure the coverage meets your needs. Online insurance comparison tools can be helpful for this process, or you can work with an insurance broker who specializes in medical malpractice coverage.

Take the reputation of the insurer into consideration.

Your malpractice insurer should have a strong reputation for fair claim handling and a history of financial stability. Check for ratings from agencies like A.M. Best or Standard & Poor’s, which assess the financial strength of insurance companies. Additionally, ask other physicians about their experience with different insurers, especially in terms of claim resolution.

Make sure you understand the coverage options available when selecting malpractice insurance.

In addition to deciding between claims-made and occurrence-based policies, you may also want to investigate:

  • Tail coverage- which protects you from claims made after the policy ends.
  • Nose coverage- which protects you from claims related to incidents that occurred before your current policy starts.
  • Cyber liability coverage- which protects you from data breaches or cyberattacks if you work in a practice that handles electronic medical records.

Work with a specialized insurance broker.

A broker who specializes in medical malpractice insurance can be an incredibly valuable resource. They’ll have a deep understanding of the unique risks physicians face and can help you navigate the intricacies of coverage options. Brokers can also compare policies from multiple insurers to ensure you get the best deal.

4. Review the policy terms carefully

Once you’ve selected a malpractice insurer, review the policy carefully before signing. Pay close attention to:

  • Exclusions- what is not covered by the policy?
  • Policy duration- how long does the coverage last and are there renewal terms?
  • Premium rates- are they fixed, or could they increase over time?

Verify the policy provides comprehensive coverage that fits your unique needs as a physician, both now and as your career progresses.

Having the right malpractice insurance is essential for physicians to protect their professional and financial well-being. Whether you’re a new physician just starting your career or a seasoned practitioner reassessing your coverage, taking the time to review your malpractice insurance is an investment in your future.

For more information on insurance and other best practices as a physician, visit PracticeLink.com/resource-center.