Malpractice Insurance Basic Factors to Consider Before You Purchase

Price generally drives most of our consumer purchases, and buying medical malpractice insurance is no different. And as premiums have risen steadily over the last several years, the obvious choice is to get the lowest price. I’m all for the best deal, but you’ll need to have a solid understanding of what you’re paying for in return to be assured of solid coverage.

Here are some key provisions that need to be considered when acquiring medical malpractice coverage:

Do the expenses from defending a claim erode the per claim limit?

In an effort to provide an option for doctors to keep their costs down, insurance carriers will have the expenses accrued from the claim deduct the amount of money available for a potential settlement or verdict and depending on the complexity of a claim as well as the injury to the patient, the amount of insurance money available could become an issue in whether or not a claim gets defended or settled.

Will you have consent to settle?

A lot of physicians understandably want to defend their professional reputation and can control whether or not a case gets settled if they have a consent to settle provision in their policy. If they don’t have consent, a carrier can settle their case without their approval and with that settlement, a report to the National Practitioner’s Data Bank will be required.

Will you have coverage to retain an attorney in the event you have to give a deposition or are required to respond to a complaint registered with your state board registry?

Having a ‘proceedings’ option on your policy will provide you with the ability to hire an attorney to prepare and present you for a deposition. The concern surrounding a deposition [without an attorney] is the possibility of answering questions erroneously and then you can wide up getting amended into that case.

Board complaints cannot be taken lightly either and if there isn’t a proper response, you may find yourself with an action against your license. Having an attorney available who has dealt with the regulatory boards can minimize and possibly eliminate any potential disciplinary rulings against you.

Your best bet is to tell your broker what you desire in a policy. Eroding limits, consent to settle clauses and coverage to hire an attorney for legal proceeding issues may not seem important, but you should still ask for a complete explanation as to what your policy covers and then determine what options are best. You may find out that the additional benefits and the extra cost to add such benefits are well worth it.

Todd M. Biondo, CPCU
Assistant Vice President – Healthcare Claims
Darwin National Assurance – an Allied World Company
9 Farm Springs Road
Farmington, CT 06032