Dental Laboratories & Risk
Despite not working with patients directly, the work dental laboratories perform also includes risk. Mistakes while crafting made-to-order dental products such as bridges, crowns and dentures can lead to complaints. Furthermore, dental laboratories rely heavily on the equipment required to perform the work. If such equipment fails, gets stolen or is lost due to an accident at the lab, the business may suffer financially. In addition, as your business grows in size, your insurance requirements may change as well.
Dental Laboratory Insurance Needs
Although dental laboratories may vary in coverage needs, there are three policies in particular that most labs may find incredibly beneficial or necessary. This help mitigate the risks associated with faulty dental products, the protection of valuable equipment, and employee injury.
The following insurance policies will cover these key areas:
- Business Owners Policy (BOP)
- Workers Compensation
- Errors & Omissions (E&O)
Let’s explore how these three insurance products can help dental labs mitigate key risk areas.
Business Owners Policy (BOP)
Any business that relies both on its property, as well as certain liability concerns, will find value in a Business Owners Policy. For a dental laboratory, this kind of policy covers your business property concerns, while including elements of Business Interruption and General Liability policies as well.
If your equipment is lost in a fire or stolen, this may quickly lead to a significant halt of your business and your ability to generate income. For uninsured labs, this could mean shutting down for good, as dental lab equipment can be expensive to purchase. A BOP will cover your business while lab equipment is replaced or repaired by helping to cover the cost of those replacements and supplementing income, depending on the scenario, during that time period where operations have been either shut down or severely limited.
How large is your dental laboratory? How many employees do you hire? Depending on where you operate and the exact number of employees you have, you may be legally required to purchase Workers Compensation to cover your workers. Although many may see dental lab work as a low-risk venture, there are some risks involved. Regardless of how risky the business is, however, legal requirements to purchase Workers Compensation should not be overlooked.
The costs associated with failing to purchase Workers Compensation can be high as well. If an employee is injured while using a lathe to create dentures, for example, a Workers Compensation policy would help to cover costs associated with medical treatment and lost wages. However, if you do not have insurance, your business may have to pay that employee directly, a cost that could be in the tens of thousands of dollars.
Errors & Omissions (E&O)
As dental labs specialize in creating very specific, often made-to-order dental products, there is a good chance an Errors and Omissions claim may arise. Although a good amount of dental product creation is computerized, with the process more automatic than human-driven, there is still room for error. Indeed, inputting incorrect measurements for a product can lead to incorrect fittings, while some products crafted in the lab are still done by hand, even if by very skilled professionals.
Though those who receive your products more often deal with their dentists and not the dental lab, your business can be held liable for perceived mistakes derived from incorrectly fitting or malfunctioning products. Generally, dental offices may be indemnified with regards to errors or mistakes originating from the dental laboratory, so these claims will likely be passed directly onto your business.
E&O insurance will cover the costs associated with defending against such claims, and will also provide coverage should a payout be necessary.