If you have recently received your doctorate and wish to practice medicine, one of the most important things that you should do before getting started is to look into medical malpractice insurance. While you plan to be as careful as possible, you never know when an alleged claim will be brought against you that will require coverage if you wish to avoid having to pay out of pocket.
While looking over your options, you may have come across one type of policy known as claims-made insurance. Before you choose this type of coverage, there are a couple of things that you should know about claims-made malpractice insurance.
1. Alleged Claims Are Covered by the Policy Year of the Incident Instead of When the Claim Was Filed
One thing that you should know about a claims-made policy is that any alleged claims are covered by the policy year in which they occurred. This is in contrast to an occurrence policy where coverage kicks in the year the claim was filed.
When you sign up for claims-made insurance, the policy's inception date becomes the date when claims can retroactively be made against the policy. This helps to protect you against claims that happened years before when you first signed up for the insurance.
2. Policy's Reporting Period Can Be Extended Using Tail Coverage If You Decide to Stop Practicing Medicine
Another thing that you should know about claims-made malpractice insurance is that you can extend the coverage even if you stop practicing medicine. With occurrence insurance, you would need to keep the policy fully active.
However, if you decide to stop or retire, you can stop the policy from covering the years afterward while adding what is known as tail coverage. This coverage extends the reporting period of the policy so that you are protected against claims that happened before you stopped practicing but were reported later.
If you are considering purchasing a claims-made policy, remember that any alleged claims are covered by the year the incident occurred and not the policy year it was filed as long as the incident did not occur before the policy's inception date. If you ever decide to stop practicing, you can extend the policy reporting period using what is known as tail coverage to ensure that you are protected from any claims that are filed afterward. Speak with an agent for help choosing a policy as well as to receive a medical malpractice insurance quote based on your practice's needs.