Cycles in Professional Liability
Medical Malpractice Insurance is not a topic that warms the hearts of physicians, but the cost of this necessary insurance over a career makes it a study worth consideration. Though pricing across U.S. jurisdictions varies widely, consider the following:
For comparative purposes only imagine that, over a 35 year career a physician in New England with no claims, purchasing a $1M per claim/$3M aggregate Occurrence form policy could pay more than:
- $325,000 in Internal Medicine-No Surgery
- $150,000 in Pediatrics- No Surgery
- $450,000 in Gastroenterology -Minor Surgery
- $1,000,000 in General Surgery
- $130,000 in Psychiatry
- $2,000,000 in OB/GYN Major Surgery
These numbers change over time, as do market conditions, and they are not reliable when determining a particular physician’s expense over a career. However, the sheer weight of these numbers should make one thing apparent — these are big numbers with significant dollars at risk if you aren’t paying attention. This is why it is critical to work with skilled insurance professionals with a focus on Professional Liability.
In the history of malpractice insurance there is one certainty — Cost and availability of coverage move in cycles. These cycles are driven by two factors: claims trends (frequency and severity) and insurer financials (the capital which insurers maintain to pay claims.) Fluctuations in these key factors have occurred several times in the past 40 years and will do so again.
The choice of a competent broker watching these trends can mean your price and protection are where they should be at any point in your career. One who is knowledgeable about the malpractice insurance marketplace, as well as the changing face of medicine and how that affects your particular specialty, is extremely valuable to you. Something as basic as a change in your scope of practice can mean adjustments to coverage and cost, and you are well-served to ask questions and keep your insurance broker in the loop as you see changes looming for you and your practice.
Thomas J. Bryant, ARM
Tom is slated to assume to role of President of PIAM in June 2017. Tom has spoken on Professional Liability and other Insurance issues at UMASS Medical School, Tufts Medical School, the Physician Assistant Program of Bryant University and the Young Physicians Workshop. If you have questions about how to strengthen your insurance program, or would like to discuss a speaking engagement, Tom can be reached at 781-434-7391 or by email at firstname.lastname@example.org.