Malpractice Insurance Policy Information

Malpractice Insurance. A type of insurance purchased by health care professionals (and sometimes by other types of professionals, such as lawyers). It protects such professionals against potential negligence claims made by their patients and/or employers.
malpractice insurance covers bodily injury or property damage as well as liability for personal injury such as mental anguish. This includes the costs of defense and cost containment expenses.
Malpractice insurance protects your company from negligence claims with rates as low as $67/mo. Get a fast quote and your certificate of insurance now.
Below are some answers to commonly asked malpractice insurance questions:
- What Is Malpractice Insurance?
- How Much Does Malpractice Insurance Cost?
- What Does Malpractice Insurance Cover?
- What Types Of Malpractice Insurance Are There?
- Is Malpractice Insurance Mandatory?
- What Does Malpractice Insurance Cover & Pay For?
What Is Malpractice Insurance?
Malpractice insurance, also known as professional liability insurance, is a type of insurance coverage that protects professionals, such as doctors, lawyers, and accountants, against claims of negligence or wrongful acts in their professional capacity.
This insurance covers the cost of defending against a lawsuit, as well as any settlements or judgments that may result from the lawsuit. The purpose of malpractice insurance is to provide financial protection for professionals and to give their clients peace of mind that they will be held accountable if they make a mistake.
How Much Does Malpractice Insurance Cost?
The average price of a standard $1,000,000/$2,000,000 Malpractice Insurance policy for small professional businesses ranges from $67 to $79 per month based on location, size, payroll, sales and experience.
What Does Malpractice Insurance Cover?

Malpractice insurance covers several expenses involved in defending and settling the malpractice suit; it also pays the damages if you are found liable.
The covered costs include: court costs, attorneys' fees, settlement costs, arbitration costs, and compensatory damages and medical damages.
Medical malpractice will usually not cover liability arising from criminal acts, sexual misconduct or alteration of medical records. Other typical exclusions are for: punitive damages and specialized procedures (e.g., radial keratotomy) for which coverage may be "bought back" in return for additional premium.
What Types Of Malpractice Insurance Are There?
malpractice insurance comes in several basic forms:
- An occurrence policy provides coverage for alleged incidents (injuries) that happened during the policy year regardless of when the claim gets reported to the carrier. The claim can be reported at any time in the future, even if the policy has cancelled. The occurrence policy provides a separate coverage limit for each year the policy is effective. Occurrence policies offer a steady base premium that does not increase as the policy matures.
- With a claims-made policy, an incident must happen and be reported to the insurance company while the policy is effective. As can be seen, this requires that coverage must extend for a significant period of time to provide adequate protection since a considerable amount of time may elapse between when an incident may have occurred and when a claim is made.
- Tail insurance refers to a policy that the insured can purchase when he discontinues his claims-made policy. Tail coverage requires that the policy holder pay an additional premium. The issue, however, is that the additional premium coverage can be extremely expensive - sometimes 150 or even 200 percent of the price of a mature claims-made policy, depending on the medical specialty and the location.
Claims-made policies tend to be less costlier than occurrence policies because of the smaller insurance company time exposure to claims. Some other factors that determine how much the policy costs include:
- Physician or provider specialty (costs vary based upon exposure to risk).
- Type of coverage, occurrence or claims made.
- Limits of liability (aggregate amounts, deductibles and managed care requirements).
- Location of practice (costs vary widely by state, county and city).
- Loss history.
Is Malpractice Insurance Mandatory?
There is no legal requirement to have medical malpractice insurance but it's important to protect yourself and your business against events you cannot foresee. Also, in today's society, people are increasingly ready to bring a claim against you if they feel dissatisfied - whether or not you are actually at fault.
Claims can run into many thousands if not millions of dollars and having malpractice insurance could be the difference between a business being able to survive a claim or not.
Buying Medical Malpractice Insurance
When shopping for a medical malpractice liability insurance policy, most physicians focus on premium costs. But physicians shopping for a malpractice policy should also focus on getting the right coverage limits.
A coverage limit is a provision in a policy under which the insurance company says that it will only pay for losses sustained by the policyholder up to a certain dollar amount. If limits are too low, the physician is needlessly exposed to personal liability. Too high, and the physician is paying for more coverage than needed.
Handling Malpractice Claims
In most cases, in order for your insurance policy to provide you with coverage, you should notify the insurance company as soon as reasonably possible of the problem. If you do actually become involved in a claim or lawsuit, for example, you receive a summons and complaint, before coverage is activated, you must notify the insurance company right away. Always follow up an oral notice in writing.
Malpractice Insurance - The Bottom Line
Even the most competent professional can make a mistake and should protect against that possibility. Defending a malpractice lawsuit is often expensive even when the defendant wins. Health care professionals win most malpractice lawsuits, but the legal system rarely allows for the recovery of expenses by the winner.
Since the cost of defense is high and a loss can be devastating, this insurance product is essential to every practice.
What Does Malpractice Insurance Cover & Pay For?

Medical malpractice claims arise when a healthcare professional's negligence or omission results in harm to a patient. Here are some examples of medical malpractice claims and how medical malpractice insurance can help pay for the lawsuit:
Misdiagnosis: If a doctor misdiagnoses a condition, the patient may receive the wrong treatment, leading to harm. Medical malpractice insurance can help pay for the cost of the patient's treatment, compensation for their pain and suffering, and legal fees associated with the lawsuit.
Surgical Errors: Errors made during surgery can result in severe injuries, infections, or even death. Medical malpractice insurance can help pay for the patient's medical expenses and lost wages due to the injury, as well as compensation for their pain and suffering.
Medication Errors: If a healthcare provider prescribes the wrong medication or the incorrect dosage, it can lead to severe health consequences. Medical malpractice insurance can help pay for the cost of the patient's medical treatment and any legal fees associated with the lawsuit.
Birth Injuries: If a healthcare provider fails to monitor a pregnancy or delivery correctly, it can result in serious birth injuries to the baby and mother. Medical malpractice insurance can help pay for the cost of the baby's medical treatment and any necessary long-term care, as well as compensation for the mother's pain and suffering.
In all of these examples, medical malpractice insurance can provide financial protection to healthcare professionals and their practices. It can help cover the cost of legal fees, settlements, and judgments, ensuring that healthcare providers can continue to provide quality care to their patients without facing financial ruin due to a lawsuit.
Additional Resources For Medical Insurance
Discover small business insurance for medical and dental professionals. Medical malpractice insurance is a type of professional liability that protects health care professionals from liability causing in bodily injury, medical expenses and property damage.
- Ambulatory Surgical Center
- Art Therapy
- Assisted Living Facilities
- Audiology
- Blood Banks
- Dental Lab
- Dental Office
- Diagnostic Imaging Centers
- Health Maintenance Organizations
- Healthcare Facilities
- Home Medical Equipment Dealers
- Hospitals
- Hypnosis
- Malpractice
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- Medical Marijuana Dispensary
- Medical Practice
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- Mental Health Counseling
- Nurse
- Nurse Registry
- Occupational Therapy
- Ophthalmologist
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- Osteopathic Physicians
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- Plastic Surgeons
- Podiatrists
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- Psychology
- Psychiatrists
- Skilled Nursing Facilities
- Speech Therapy
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- Surgeons
- Telemedicine Business Insurance
- Veterinarian
- Specialty Medical Centers And Clinics
- Specialty Medical Malpractice

The medical industry is a crucial sector that plays a vital role in ensuring the health and well-being of individuals. It is a complex and highly regulated industry that requires specialized knowledge and expertise. As a result, the medical industry is exposed to a variety of risks, including legal and financial liabilities.
One of the main reasons why the medical industry needs commercial insurance is to protect against medical malpractice. Medical malpractice occurs when a healthcare provider deviates from the standard of care and causes harm to a patient. It can lead to costly lawsuits and significant financial losses for the healthcare provider. Business insurance helps to cover these costs and protect the financial stability of the medical facility.
Another reason the medical industry needs business insurance is to cover the cost of regulatory fines and penalties. The medical industry is subject to strict regulations and any violations can result in significant fines and penalties. Business insurance helps to cover these costs and protect the financial stability of the medical practice or facility.
In addition, the medical industry is vulnerable to data breaches and cyber attacks. These incidents can result in significant financial losses and reputational damage for the medical facility. Business insurance helps to cover the cost of recovering from a data breach or cyber attack and helps to protect the reputation of the medical facility or practice.
Overall, business malpractice insurance is an essential component of the medical industry. It helps to protect against the financial and reputational risks associated with the medical industry and helps to ensure the financial stability and success of medical practices and facilities.
Minimum recommended small business insurance coverage: Business Personal Property, Business Income and Extra Expense, Employee Dishonesty, Money and Securities, Accounts Receivable, Computers, Physicians and Surgeons Floater, Valuable Papers and Records, General Liability, Employee Benefits, Professional, Umbrella, Hired and Non-owned Auto & Workers Compensation.
Other commercial insurance policies to consider: Building, Earthquake, Equipment Breakdown, Flood, Leasehold Interest, Real Property Legal Liability, Computer Fraud, Forgery, Cyber Liability, Employment-related Practices, Business Automobile Liability and Physical Damage and Stop Gap Liability.