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January 8, 2024

A guide to medical professional liability insurance

Health care jobs account for about 9.3% of total employment in the United States, with about 14.7 million people working in some type of medical-related field, according to the U.S. Bureau of Labor Statistics. Even though many of these jobs require years of training and experience, problems and mistakes can still occur, making it essential to protect health care professionals from lawsuits and liability claims. And with the number of people in this profession, these issues have can impact in the medical sector if protective measures aren’t taken.

If your company is a part of this industry or deals with any type of medical services, you should consider purchasing medical professional liability insurance. Learn about your coverage options and other key insights here.

What is medical professional liability insurance coverage?

Medical professional liability insurance protects physicians and other licensed health care professionals from liability associated with wrongful practices resulting in bodily injury, medical expenses, and property damage.

This insurance type is purchased by physicians to reduce the risks of financial loss that can occur if a patient claims that they were injured due to medical negligence. When a company buys medical liability insurance coverage, it transfers the responsibility of certain claims against them to the insurance provider instead of putting themselves at risk for any dollar amount paid on claim defense or resolution.

This type of coverage is essential because claims can come at hefty prices. For example, the average medical malpractice payout in the United States is $242,000. This amount has remained relatively constant over the years, according to Justpoint. Having financial assistance from your insurance company can keep this amount from disrupting your medical business.

Not all insurance policies are the same, and it’s vital that medical professionals understand what is covered under a policy and what is excluded. For instance, general liability insurance only covers physical risk, such as bodily harm and property damage. Medical liability insurance offers more specific protections like errors and omissions or physicians’ negligence.

What are the two types of medical professional liability insurance?

While there are several ways to customize your premium, there are two basic types of medical malpractice insurance: claims-made and occurrence-made.

  • Claims-made insurance: Protects you from covered medical malpractice claims and risk if the insurance company that issued your policy to you at the time of the alleged occurrence is the same company at the time the claim is filed in court. 
  • Occurrence-made: Any covered malpractice occurrence will be covered by the insurance carrier if it was the insurance company at the time of the event, regardless of whether it was the carrier at the time the claim is filed in court.

No matter what style of premium you select, the cost generally depends on your:

  • Cadence of work
  • Previous claims filed against you
  • Professional specialty 
  • Years of experience

The advantages of protecting your medical business

Liability coverage is essential to practice with peace of mind and confidence, no matter what type of medical care you provide patients. Medical malpractice insurance ensures lawsuits, omissions, medical negligence, and other claims don’t sweep the rug out from under your feet.

Even if you’ve been in the industry for years, you never truly know what types of risks you’ll face until it’s too late. Rather than wait for an issue, proactively seek a risk management solution that can help secure your bottom line and reputation from harm.

Don’t let health care risks stop your business from focusing on patient safety and providing beneficial services to your community. Protect your team by partnering with Marsh McLennan Agency. We offer specialized solutions to a variety of organizations, from hospitals and laboratories to pharmacies and senior living organizations, all tailored to fit your unique needs.

Reach out to a Marsh McLennan Agency specialist to learn more.