Medical Professional Liability

Modern Insurance Partner

Medical professional liability insurance, sometimes known as medical malpractice insurance, is one type of professional liability insurance which protects physicians and other licensed health care professionals (e.g., dentist, nurses) from liability associated with wrongful practices resulting in bodily injury, medical expenses and property damage, as well as the cost of defending lawsuits related to such incidents.

A medical professional liability insurance policy covers bodily injury or property damage as well as liability for intangible injuries such as mental anguish. Due to the complexity involved in discovering negligence, a higher percentage of premium dollars going toward defense and cost containment expenses than payouts of actual damages in those cases. However medical liability insurers spend significant funds investigating and defending claims where there is an adverse patient outcome that did not result from negligence.

There are two basic types of malpractice insurance—occurrence or claims-made. Many insurers write on a claims-made form basis where a policy in effect at the time a claim is reported responds for the loss, while the policy remains in force and during any applicable extended reporting period. The policy that was more popular in earlier times is occurrence-made which covers a loss that "occurs" during the policy period, regardless of when the claim was made, and even after the policy has been canceled.

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