There are two different types of medical malpractice insurance: claims-made and occurrence. Each type has its own benefits and drawbacks, so it’s important to know which one is right for you before you purchase medical liability coverage.
Let’s explore the differences between these two types of medical insurance, and where you can go for assistance in finding the best policy for you.
What Is Medical Malpractice Insurance and Why Do You Need It?
Medical malpractice insurance – also called medical liability insurance – is a type of financial coverage that protects healthcare professionals from lawsuits that may arise over the course of their careers. Whether the patient’s claim is due to an actual mistake or negligence on your part, or whether it is a frivolous claim, the purpose of having insurance is to protect you either way.
Having medical malpractice insurance is not a sign of culpability on the doctor’s part any more than a driver having car insurance is a sign that they’re a careless driver. In fact, similarly, many states and hospitals require doctors to carry malpractice insurance in order to practice medicine in their state.
Why Are There Different Types of Medical Liability Insurance?
Claims-made policies are the most common type of medical malpractice insurance that is carried by physicians, and this type of policy offers the most protection against lawsuits. Occurrence policies are less common and tend to be more expensive, but they offer more protection per claim (occurrence) than claims-made policies do.
Here’s a breakdown of the differences between these two types of policies:
Claims-made policies provide coverage for (1) incidents that occurred during the policy period and (2) claims that are actually filed during the policy period. This means that if an incident occurred during your policy period but the lawsuit was filed after the policy expired, you would not be covered for any damages sought.
However, you are likely to be able to buy tail coverage for your claims-made policy, and tail coverage will extend the coverage for a few years after the policy ends in order to prevent the aforementioned situation. Some claims-made medical liability insurance policies actually include tail coverage; if it is purchased separately, it might cost twice as much as your annual malpractice insurance premium.
Occurrence policies provide coverage for claims that are made during the policy period AND after the policy expires. This is beneficial because it means that you do not need tail coverage, but the tradeoff is that this type of plan is usually much more expensive.
Find the Best Malpractice Insurance for Your Medical Practice
There is a lot of overlap and many intricacies involved in choosing medical liability insurance, so you will want someone to be in your corner who can help you choose a medical malpractice insurance policy. Our team at eQuoteMD offers one of the largest medical malpractice insurance networks in the U.S. We work with malpractice insurance companies to provide coverage for all medical specialties, and we advocate for our clients to find them the best rates possible without sacrificing optimum coverage.