Gaps in Med Mal Coverage
No matter where you are located in the U.S., whether you have California med mal insurance or Maine med mal insurance, a gap in coverage is a bad thing. In short, admitted insurance carriers are resistant to cover physicians that have a gap in coverage.
What is a gap in coverage? A doctor creates a gap in coverage when:
1) He or she goes bare and does not purchase coverage, or
2) Terminates a claims-made policy and does not purchase a tail or does not have the new policy pick up prior acts coverage.
The med mal insurance companies view a gap in coverage in a similar way to how they view claims. The reason for this is that a gap in coverage exposes an insurance company to vicarious liability. While the malpractice insurance company wouldn’t necessarily be responsible for defending and paying a claim for when the physician was uncovered, they still view it as the physician not taking responsibility for his or her practice.
So you have a gap in coverage. Now what?
While a gap in med mal insurance coverage is definitely undesirable in most cases, there are solutions to closing a gap in coverage or the ability to secure coverage with a gap.
Closing a gap in coverage. If for some reason, you decided to terminate a policy and not purchase a tail, you may be able to find a company, depending on the state, that is willing to close that gap with a stand-alone tail. Of course, you will be required to sign a no-known-loss letter that states that you are unaware of any claims being made against you for the time period that the tail is covering.
Securing med mal insurance coverage with a gap. If you decide that you do not want to purchase a stand-alone tail, you can usually find coverage, albeit at a higher expense, through a surplus lines company.
The agents at MyMedicalMalpracticeInsurance.com will always advise their clients to avoid a gap in coverage and will always help a client try and close a gap as cheaply as possible. If you have a gap in coverage that you would like to close, or would like to discuss further, contact us.