Dental professional liability (malpractice) insurance – is an important coverage to learn more about. Not having insurance, not having the right kind of coverage or not really understanding the whole topic can put you and your practice at risk. State laws vary, and so do insurance requirements. What are your options for purchasing a policy to protect you and your dental practice? Where do you begin?
Don’t be overwhelmed. The ADA provides its members with resources to navigate this insurance marketplace. Below is a checklist of frequently asked risk management questions with answers.
1) What is dental professional liability insurance?
Dental Professional Liability (malpractice) insurance protects against claim allegations arising out of dental treatment or services you and your employees provide, or should have provided, to patients. This insurance covers the cost of defense, settlement and/or awards for damages resulting from professional liability lawsuits and claims.
2) Is dental malpractice insurance required to practice?
Malpractice insurance is required to practice dentistry in most jurisdictions, although licensing regulations and insurance requirements vary by state. Contact your state licensing board and/or local dental society to verify your state’s requirements for health care providers before purchasing a policy.
3) What is the difference between claims-made and occurrence policies?
a) an "occurrence" policy covers claims for dental treatment or service provided while the policy is in force, regardless of when the claim is made (e.g., even after the policy has terminated);
b) a "claims-made" policy requires that both the treatment or service you provided and the claim be made while the policy is in force. If a claim is filed after the policy terminates, no coverage is provided unless the insured purchased an "extended reporting endorsement” or commonly referred to as “tail” coverage.
Consult with a licensed insurance agent to discuss your insurance needs and what policy options are available to best protect you and your dental practice.
4) If I am insured under a claims-made policy and retire from active practice, do I need to be concerned with malpractice coverage?
Most insurers offer "tail" coverage at no cost to existing policyholders who have been insured for five or more years in the event of disability, retirement or death. Consult with your licensed insurance agent and the insurance company that underwrites your policy to determine whether tail coverage is provided.
5) What is an appropriate amount of coverage or policy limit for dental malpractice insurance?
The ADA does not offer set guidelines as to what is considered an appropriate limit of liability coverage because risk factors vary widely based on practice location, type and scope of practice, procedures and use of anesthesia, risk tolerance, cost considerations, employer requirements, etc. Additionally, some state laws (e.g., Patient Compensation Funds) set certain requirements that must be met regarding malpractice insurance policy limits.
Many of the leading dental malpractice insurance providers commonly market policies with limits up to $1 million per occurrence (the maximum amount an insurer will pay for a single claim) and $3 million or higher aggregate (the total amount an insurer will pay for all claims incurred within a policy year.) You are best advised to consult with your licensed insurance agent on what policy limits are appropriate to adequately protect you and your dental practice.
6) Do I need to carry separate limits of liability on my dental practice?
If your dental practice is incorporated, your insurance agent may recommend carrying separate limits of liability to adequately protect the entity and avoid having to "share" your limits of liability in the event both you and the practice are named in a claim or lawsuit. Consult with your insurance agent or legal advisor on what limits are appropriate to insure your practice structure.
7) What is a "consent to settle" provision?
A key provision of a dental professional liability policy is whether the insurance company has the right to settle a claim without your consent. If your policy contains an unrestricted consent to settle clause, the insurance company may not settle with a claimant without your written approval. Be sure to discuss this important feature of coverage with your insurance agent and legal counsel to clearly define your rights under your policy, including any exceptions or limitations such as mandatory arbitration or a “hammer” clause which could make you financially responsible to share in the cost of the claim.