Gaps in Med Mal Coverage

Physician Talking with Med Mal Insurance Agent Over Computer 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 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.

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