A malpractice suit against you can be a financial catastrophe. That’s why you need to protect yourself with malpractice insurance. Find out more in this episode of the Finance Flash Go podcast!
Malpractice insurance is expensive but a bit less complicated than disability insurance. Basically, you want to make sure that your malpractice insurance carries high enough coverage. Generally, you want $1 million/$3 million in coverage. The cost of suits can add up but having a decision made above these limits is also rare.
There are also two types of malpractice insurance…
Claims based malpractice insurance determines who is responsible for paying based on when the claim was made. For example, if you worked at one hospital with one malpractice insurance in 2015 and now and you work in a different hospital and are sued by a patient from 2015, the old policy would not cover it. That is because they base things on when the claim is made. If you have this type of policy, you need to buy tail coverage for when you leave the job to cover claims made after you leave. It is expensive but not worth the risk not to have it. Occurrence based coverage is based on when the incident in question occurred. Therefore, in the above scenario, the old malpractice insurance would cover the claim since the occurrence was in 2015 when you had that insurance. Occurrence based in obviously better.
Many group policies will be available based on your job. Again, talk to your HR rep to get all of the details about the policy. If they are not covering you at all or adequately enough, you will need to buy malpractice insurance on the market.
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