Most FAQs Regarding Doctor Liability Coverage, Part 1

Thinking PhysicianThe doctor liability agents here at MyMedicalMalpracticeInsurance.com answer a lot of questions daily. In addition to being liability agents, they they pride themselves on being physician educators. As physician advocates, MyMedicalMalpracticeInsurance.com understands the importance of providing our doctors with the right products to meet their needs. And, just as our doctors have their specialty, we have ours: liability coverage. It is our job to find our doctors the right coverage at the best price and to make sure that our clients understand, and are comfortable with, the details of their policy.

In the process of educating our clients about doctor liability coverage, there are many questions that our agents answer frequently.

Here are the most frequently asked questions we see regarding doctor liability coverage:

1. What’s the difference between a claims-made policy and an occurrence policy?

A claims-made insurance policy has a retroactive date. The policy starts out relatively inexpensively and gets more expensive years one through five (this is called a step-rate increase). At that point, the rates typically do not get any higher, unless you have a claim or the insurance company raises rates. And, it doesn’t go any lower unless you stay risk-free, you do your online risk management courses if available, or the insurance company lowers rates. If you leave the practice you are at, or quit, you may be required to purchase a tail. A tail is typically two times last year’s premium. It is absolutely 100% recommended that you verify whether or not you need purchase a tail for your policy so as to prevent having a gap in coverage. See our recent article on stand-alone tails for more info.

An occurrence policy starts relatively expensively and remains the same price year after year and features a built-in tail. Occurrence policies are preferred by doctors who may have a short term position available or wish to have long-term security. Like the claims-made policy, the rates typically do not get any higher, unless you have a claim or the insurance company raises rates. And, it doesn’t go any lower unless you stay risk-free, you do your online risk management courses if available, or the insurance company lowers rates. You should note that not every insurance company offers an occurrence policy.

Stay tuned for more FAQs regarding doctor liability coverage.