Medical malpractice insurance provides healthcare professionals with financial protection from legal claims related to professional negligence and mistakes. It’s a form of medical professional liability insurance.
Even when it's not required, malpractice coverage is a key part of risk management. Even the most experienced healthcare providers can make a mistake or be sued for a claim of substandard care, such as misdiagnoses, surgical errors, and medication errors.
It's easy to get free quotes for medical malpractice insurance with Insureon. We'll ask you basic facts about your business to help you find coverage that matches your unique risks and meets the requirements in your state.
Contact our dedicated medical malpractice insurance specialist to get started.
A medical malpractice insurance policy is a type of medical liability insurance that defends healthcare professionals and clinics against claims of negligence, oversights, and mistakes when delivering professional services.
Medical malpractice also covers healthcare and therapy/counseling services provided through telemedicine.
Specifically, medical malpractice insurance coverage includes:
In healthcare, a simple mistake can have far-reaching consequences. When a patient sues over a mistake made by a medical professional, such as administering the wrong dosage of a medication, medical malpractice insurance can help pay for your legal costs.
Medical professionals often juggle multiple patients at once, which can lead to accidental oversights in a patient's medical history, preoperative instructions, or drug interactions. If the patient files a lawsuit, medical malpractice insurance helps cover the health professional's legal fees.
Healthcare professionals are at constant risk of negligence claims. From misdiagnoses to surgical errors and poor follow-up care, medical professionals face a wide range of risks related to lack of proper care and are at risk for lawsuits. Medical malpractice policyholders would be protected if they were sued for negligence.
When your medical practice promises a service and fails to deliver, the result could be a lawsuit – especially if a patient's physical or mental health is impacted. Malpractice insurance covers legal costs related to missed appointments and undelivered services.
Medical malpractice insurance benefits a variety of healthcare professions that provide patient care. It's designed for both businesses and independent contractors that make a living off of providing health-related professional services. Depending on state law, some professions may be required to carry this coverage.
A few specific professions need medical malpractice coverage more often than others, including:
Serving on the frontline in healthcare, nurses face regular interactions with patients that leave them vulnerable to risks. If a patient accused you of giving the wrong medication or injection, you could face an expensive lawsuit. The hospital, clinic, or temporary agency that employs you might have its own liability coverage, but this might not give you sufficient financial protection in the event of a claim.
Similar to nurses, doctors are on the frontline of healthcare. From creating treatment plans to performing surgeries or other medical procedures, doctors find themselves in the unique position of making critical decisions related to patient care. Of course, this opens up the opportunity to lawsuits from dissatisfied patients.
Medical malpractice coverage offers doctors the necessary protection so they can work with peace of mind without worrying of the financial risks of a possible lawsuit from a disgruntled patient.
Physical therapists come into contact with patients directly through stretching, exercise, and massage. Patients often experience some level of pain during treatment, and the level of interpersonal contact means that even the most experienced physical therapist could have an injured patient accusing them of a mistake.
A patient might accuse an acupuncturist of failing to diagnose an issue and refer them for additional medical care. They could also say you caused nerve damage or an infection during treatment. Malpractice insurance provides financial protection against these types of claims.
While medical malpractice insurance covers many aspects related to legal action from a client, it does have a number of coverage exclusions. For example, it only covers the cost of defending against lawsuits – it doesn't pay for lawsuits you initiate.
Unless your policy has prior acts coverage, it will only cover any claims filed while the policy is active and for incidents that occurred after you bought the policy. In this case, endorsements can fill gaps in your malpractice coverage.
Other exclusions from medical malpractice insurance coverage include:
If a patient trips on a rug and suffers an injury at your clinic, or you accidentally damage an item that belongs to a patient, your medical malpractice insurance will not cover you.
However, for these events, general liability insurance can help pay for medical expenses, or the cost of repair or replacement. It can also cover legal expenses if the customer sues.
If an employee at your practice or clinic gets injured, such as a nurse who suffers a back injury from lifting a patient, medical malpractice would not provide the necessary insurance protection.
Instead, you would need workers' compensation insurance, which helps cover medical expenses and disability benefits if an employee is injured on the job, or develops an occupational illness.
For example, suppose a fire at your healthcare facility destroys your computers, furnishings, and medical equipment. The property insurance included in a business owner’s policy would help pay for replacement of the ruined items and renovation of your damaged building.
If an employee gets into an accident while driving your business vehicle, commercial auto insurance will help cover medical bills and other damages.
For instance, suppose a hospital's ambulance gets into a head-on collision with another vehicle. Both drivers are injured, and both vehicles are damaged. The hospital's commercial auto policy would then cover the resulting medical expenses, property repairs, and any legal costs or settlement.
Some medical systems provide this coverage for their staff. Others self-insure themselves and their staff by creating a liability trust fund to cover the legal defense and settlement costs for malpractice claims. However, healthcare professionals may need to buy their own coverage.
It’s important to make sure you meet your state’s minimum requirements for malpractice insurance, while also taking the risks of your own practice into account.
The most experienced and attentive of professionals can make a mistake or face an expensive and frivolous lawsuit. Medical malpractice insurance covers your cost of litigation, such as attorney fees, as well as punitive and compensatory claims for medical damage.
Even if your employer or the facility where you work has their own liability protections, it can be worth pursuing your own malpractice insurance to make sure you’re fully covered.
The two types of medical malpractice insurance coverage are claims-made and occurrence-based policies.
Businesses will find that most medical malpractice policies are claims-made policies, which cover incidents and claims that happen while the policy is active. If you face a lawsuit after canceling your policy, it would not be covered. Because claims must be filed while the policy is active, it's important to maintain continuous coverage.
Some insurers offer occurrence-based policies, which are more extensive. An occurrence policy covers losses that happened during the policy period, even if the policy is no longer in effect when you file a claim. If you canceled this policy, you would still be covered for any incidents that happened during your coverage period.
When buying a malpractice policy, you can customize the amount of coverage and other factors to fit your business and your budget. This includes:
Because most malpractice policies are claims-made, you may want to add tail coverage for increased protection. Also known as an extended reporting period (ERP), tail coverage allows you to file a medical malpractice claim even after your policy has expired. However, the incident related to the claim must have occurred while the policy was active.
Every policy has limits, deductibles, and exclusions that may influence your premium.
Policy limits are the maximum amounts your insurer will pay on a claim, both on a per-claim basis and on the aggregate amount of claims made within the policy period (typically one year). Your state may have minimum coverage requirements for both types of limits.
The deductible is an amount you must pay before your insurer will cover a claim. A high deductible will lower your premium, but make sure it's an amount you can easily afford.
Finally, be aware of any exclusions in a malpractice policy. It won't cover illegal activities, such as sexual misconduct, though it will cover you if you're unjustly accused.
For many small business owners, general liability insurance is often the first coverage they buy. It insures you against common business risks such as customer injuries, customer property damage, and advertising injuries. It’s often required to sign leases and contracts.
If a patient is injured during a medical treatment or procedure, it would most likely be covered by your medical malpractice insurance. If a patient or a visitor is injured by an accident, such as tripping on a rug, it would be covered by your general liability policy.
Malpractice insurance is a type of professional liability insurance, sometimes referred to as errors and omissions insurance (E&O). While the terms are often used interchangeably, they’re not exactly the same.
Professional liability coverage relates to a healthcare provider’s business activities, while malpractice covers your legal defense and settlement costs if you’re accused of causing a patient’s injury or death.
If a patient accused you of an error in their treatment that resulted in pain or expensive additional care, it would likely fall under your medical malpractice insurance.
If a customer accused you of violating their privacy under the Health Insurance Portability and Accountability Act (HIPAA), it would probably be covered under your professional liability insurance.
Medical malpractice insurance has other coverage exclusions as well. For example, it doesn't pay for lawsuits that allege patient discrimination or abuse.
It also only covers the cost of defending against lawsuits – it doesn't pay for lawsuits you initiate. For example, this policy won't cover your legal costs if you sue a patient who refuses to pay you.
Unless your policy has prior acts coverage, it only covers claims filed while the policy is active and for incidents that occurred after you bought the policy.
Endorsements can fill gaps in your medical malpractice coverage. To make sure you have the coverage you need, contact our dedicated agent.