Should you have your own malpractice insurance?

By Elizabeth E. Hogue, Esq., Burtonsville, MD

Licensed practitioners of all types who are employees of health care providers are often covered by malpractice insurance that is paid for by their employers. Employees who are covered by their employers, however, wonder whether they should also purchase their own malpractice insurance.

Below are some of the pros and cons of purchasing your own malpractice insurance coverage.

You should purchase and maintain your own malpractice insurance coverage because:

1.) When claims are filed in which you may be involved, your employer's insurance company will assign legal counsel to defend the claims. Legal counsel assigned by your employer's insurance company clearly represents your employer, not necessarily you. In fact, if legal counsel determines that the actions you took are outside the scope of your employment, your employer's insurance company may decide that there is no coverage for the claims filed against you. Under these circumstances, the only insurance you have may be the coverage you purchase yourself.

2.) In some instances, multiple claims may be filed against the same provider, including you. These multiple claims may exceed the limits of liability of your employer's insurance policies. Once again, the only coverage you may have may be the coverage you purchase and maintain yourself.

3.) Almost all practitioners have assets that should be protected, even though most practitioners are not accustomed to thinking of themselves as deep pockets. These assets often include wages from employment, a home, automobiles, savings, stocks and bonds, etc. The only way to help ensure protection of these assets is to purchase and maintain your own insurance policy.

4.) Malpractice insurance is relatively inexpensive for most types of practitioners, except for some advanced practitioners, such as nurse midwives. It is readily available through professional associations at a reasonable cost.

5.) If you purchase your own malpractice insurance and a claim is filed against you, your insurer will assign legal counsel. Unlike counsel assigned by your employer's insurance company, legal counsel assigned by your insurer owes allegiance only to you. You will have legal counsel who is solidly in your corner and who can, if necessary, counter arguments made by your employer's insurer that your employer's policy should not cover you.

6.) It is untrue that if you have your own malpractice coverage you are more likely to be sued. In most instances, patients and their families have no way of obtaining information about whether or not you have malpractice insurance before they file lawsuits. Even after lawsuits are filed, rules governing discovery may prohibit attorneys for patients and their families from getting information about whether you have malpractice insurance and, if so, the amount of coverage, etc.

You should not purchase and maintain your own malpractice insurance coverage because:

1.) Employers, especially large institutions and organizations, may not want their employees to have their own malpractice insurance. It may be time-consuming for everyone involved if your insurer assigns legal counsel in addition to counsel from your employer's insurer. The attorneys may disagree about your liability or it may be difficult for them to communicate effectively and to get on the same page regarding your best interests.

The bottom line, however, is that purchasing and maintaining your own malpractice insurance will provide peace of mind at a relatively low cost. As indicated above, the potential benefits far outweigh possible difficulties of having your own coverage. Having your own malpractice insurance in our litigious society may now constitute an important aspect of professional practice.

[To obtain more information about professional liability in a book entitled Legal Liability, send a check for $30.00 that includes shipping and handling made out to Elizabeth E. Hogue, Esq., 15118 Liberty Grove, Burtonsville, MD 20866. Phone: (301) 421-0143. Fax (301) 421-1699. E-mail: ehogue5@comcast.net.]