What Medical Malpractice Insurance Is All About:
Being a doctor isn’t easy, but it is considered to be one of the most rewarding career paths out there.
Doctors spend many years getting the right education so that they can provide the best service to their patients.
However, this doesn’t mean doctors aren’t at risk. One wrong diagnosis can leave a medical professional in a world of pain.
Let us introduce you to Medical Malpractice Insurance. The insurance that can protect a medical professional and help a medical practice stay up-and-running in the case of a lawsuit.
Read on to understand if Medical Malpractice Insurance is right for you.
What Is Medical Malpractice Insurance?
Medical Malpractice Insurance is coverage that provides legal aid and protection if a medical professional were to be sued by a patient. This can take several forms. In some cases, this insurance coverage will provide monetary assistance for a doctor to hire a lawyer. In other instances, the insurance company will provide their own “in house” lawyers to represent the policyholder. It’s also common for malpractice insurance to pay some or all of the claim if the plaintiff’s lawsuit is successful.
Do I Need Medical Malpractice Insurance?
This type of insurance comes in handy if your business:
- Is mandated by your state to carry this form of coverage
- Is required by your hospital, clinic or medical services company
- If you and/or your business interact(s) with patients
Still not sure what you need?
CoverWallet's Insurance Checklist , you'll find a list of insurance types needed for your specific business or industry.
What Does Medical Malpractice Insurance Cover?
These insurance policies can be written in several different ways, allowing them to cover a variety of situations. This type of insurance provides legal representation and money towards a settlement (if there is one). Not all policies work the same way, however.
In some cases, this type of insurance policy will only provide funds to the doctor if he or she is sued. The doctor must find legal counsel on their own, using these funds. Depending on how these policies are written, the lawyers will either receive payment from the insurance company directly, or the doctor will pay upfront and then be reimbursed for his or her legal expenses.
Some malpractice insurance policies provide no funds for a lawyer. These policies are typically a good idea for doctors in situations where a backup policy or their employer will provide legal counsel. Doctors considering a malpractice policy such as this should carefully review their additional coverages and/or employer agreements.
A growing number of malpractice insurance policies directly provide legal counsel to their policyholders. In these cases, the lawyer is typically an employee of the insurance firm and is interested in keeping the costs of the case as low as possible the insurance firm itself. The policyholder does get the benefit of a highly experienced and motivated lawyer, and the insurance company is better able to control their costs.
If the case is lost or a settlement is reached, malpractice insurance will pay to cover all or a portion of the award or settlement amount. This amount is dependent on the term limits that are written into the policy.
It should be noted that who the policy covers is explicitly stated. A doctor who owns his or her practice, for example, may be able to purchase a policy that covers only themselves or a policy that applies to all of the employees working at the business. This means that malpractice insurance for nurses employed by the doctor may not be needed, although Malpractice Insurance cost may be higher.
Those searching for nursing malpractice insurance, RN malpractice insurance, pharmacist malpractice insurance, chiropractic malpractice insurance, physician malpractice insurance or any type of insurance covering the medical field will find that Medical Malpractice Insurance companies cover all medical fields under the same insurance policy. Medical Malpractice Insurance for nurse practictioners is particularly important, as nursing assistants often come into contact with patients more often than medical doctors and physicians.
You'll Know It's the Right Policy If It Covers:
- Doctor errors resulting in bodily injury
- Medical expenses and personal injury
- Defense fees
- It covers you, as well as your business (should you own it)
What Does Medical Malpractice Insurance Not Cover?
This insurance does not cover illegal behavior, such as theft, sexual improprieties, or fraud.
More specifically, it’s important to note that this type of insurance will not cover cases in which a patient sues for reasons other than medical ones. For example, mishandling patient records, sexual misconduct, theft, and harassment would not be covered under these policies, even if these suits and/or allegations are made at the same time as a claim. If this is a concern, it may be a good idea to explore a general liability policy for the individual or the clinic.
Doctors would also note that this type of insurance policy typically does not provide any protection against being accused of Medicare fraud (or being the victim of such fraud). This is usually a separate type of coverage.
Certain professions related to the medical field will also not be covered under this type of policy. Physical therapy malpractice insurance is more commonly an extension of a Professional Liability Insurance policy, for example. The same can be said for Legal Malpractice Insurance, which will not cover attornies who are representing clients based on medical-related issues.
Some medical professionals will not need to seek out their own Medical Malpractice Insurance. Instead, they will likely be covered by the policy in place for the entire business. Nurse malpractice insurance and physician assistant malpractice insurance are therefore unnecessary as individual policies.
This insurance will not cover:
- Charges of theft
- Sexual abuse
- Fraud
- Mishandled records
- Medicare fraud
- Employee disputes
It’s also important for doctors to understand the coverage limits of their malpractice insurance policy. These policies often have coverage limits that will limit the total amount they pay for within a set period and/or per case.
What Are the Limits of Medical Malpractice Insurance?
Every policy of this type has different amounts of policy limits. There are several restrictions that all medical professionals considering this type of coverage should be familiar with. The individual limit is the amount that the insurance company will pay for a single claim. This typically only applies to the ultimate settlement or award amount, not the cost of counsel.
The aggregate limit is the total amount that a policy will pay during an established period of time (typically one year). This can cover multiple claims. These two limits are often written together so that a policy with a $1,000,000 individual limit and a $3,000,000 aggregate limit would be displayed as a $1M/$3M Medical Malpractice Insurance policy.
There can also be limits on the amount that is paid towards the cost of legal counsel. Since most policies simply provide their policyholders with an in-house lawyer, however, these limits are not typical.
How Much Does Medical Malpractice Insurance Cost?
The cost can vary significantly based on a number of issues. Policy premiums are often based on a medical professional’s previous record of malpractice cases, the geographic area he or she is practicing in, and the particular field that he or she practices in. It’s also possible for factors, such as length of employment and the history of the employer to be considered when computing premiums.
From here, premiums are then based on the total amount and type of coverage purchased. Like all insurance, higher coverage limits tend to come with higher premiums.