You pay thousands annually for medmal limits, only to see them disappear.
Medical Protective has known for over a century that there is a better option.
When drafting the insurance policy to bind them all together and shield them from this risk, they sought to ensure adequate financial protection for decades of practice. To achieve that objective, the doctors chose what would later be called occurrence coverage.
Occurrence coverage became the industry standard for the next 70 years; however, when medical malpractice claims spiked during the 1970s, most insurance companies stopped offering occurrence coverage and only offered claims-made coverage, which is more favorable financially to the insurance companies. Both policy types remain today.
Occurrence:Occurrence coverage is triggered the moment treatment occurs, regardless of when an eventual claim is made. For example, if a claim is made today based on treatment rendered in 2010, the 2010 occurrence policy responds.
Claims-made:Claims-made coverage is triggered when the claim is made. For example, if a claim is made in 2012, based upon treatment rendered in 2010, the 2012 claims-made policy responds, as long as the healthcare incident occurred after the policy’s retroactive date. (The policy’s retroactive date is the date after which treatment must occur to trigger coverage.)
1LimitsWith occurrence coverage, you receive a separate set of limits every year you have the coverage. Also, occurrence policy limits remain in place after the end of the policy period to pay claims arising from healthcare incidents occurring during the policy period.
In contrast, with claims-made coverage, only the then-current policy limits are available to pay claims made during the policy period, and even then only if the treatment occurred subsequent to the policy’s retroactive date.
2“Tail” CoverageBecause claims-made policies do not cover claims made after the termination of the policy, you are required to secure "tail" coverage (an extended reporting endorsement) when you move your coverage from one carrier to another or stop practicing.
If a claim is made against you, and you have cancelled a claims-made policy, you have no coverage unless you have either secured tail coverage or your new carrier covers your prior acts back to your retroactive date. Tail coverage is generally expensive. In fact, depending on the state, tail coverage is usually approximately 140-220% of your current, undiscounted rate. Further, payment for tail coverage is typically due in full and must be paid within 30-60 days of policy cancellation. Some companies will provide free tail coverage in the event of death, disability or in some retirement circumstances. Occurrence policies do not require tail coverage.
Confidence Will your professional liability policy provide sufficient limits to protect you, your family and your estate during retirement
Occurrence coverage provides a separate set of limits for each year you buy the policy, with respect to alleged errors occurring during the policy period, regardless of when a claim is made against you. Occurrence coverage doesn’t end when the policy terminates; instead, the limits under the policy remain available to pay future claims based upon incidents that occurred during that policy period.
Contrast this with claims-made coverage which only provides limits for claims made during the current policy year, so only the current set of limits is available to pay claims arising from all your previous years of practice. This important difference becomes more relevant as you near retirement.
Over the course of a 25 year career, a radiologist will read approximately 400,000 films — presenting 400,000 opportunities for a patient to allege malpractice. Under a claims-made tail endorsement with a standard $1M/$3M limit, there is only $1M available to pay any single claim, and only $3M total to pay all claims arising during the life of the tail coverage. This means that with claims-made coverage, the radiologist will have only one set of limits ($1M/$3M) to pay all potential professional liability lawsuits over an entire 25 year career. In contrast, if the same doctor had purchased occurrence coverage each year for the same 25 year period, he or she would have potentially 25 times the coverage. Greater limits. That’s real confidence.
Flexibility Given today’s changing healthcare landscape, can you predict what malpractice coverage needs you will have in the future? With occurrence coverage, you need not worry about securing tail coverage for any change in your life or practice.
Occurrence coverage removes all barriers so you can practice how you choose,
where you choose and for how long you choose.
Value Given these significant benefits, would you guess occurrence coverage is more expensive than claims-made?
|Remainder of State, KY Internal Medicine (No Surgery) $1/3M|