Professional malpractice insurance covers health and wellness professionals in the event that they are sued by a patient or client. A number of professions, including doctors and therapists, require their members to carry this insurance as part of their licensing.
What is malpractice insurance?
Sometimes things go wrong during treatment of a patient, who can be injured or even die. Professional malpractice insurance provides coverage in the event that a practitioner is sued for damages and legal costs. In Canada, some malpractice cases have resulted in awards of millions of dollars.
Healthcare workers, such as doctors and nurses, need outstanding coverage due to the risk that something can wrong during surgery, childbirth or medical treatments.
Veterinarians also need malpractice insurance. However, they are less likely to be hit by huge damages through lawsuits because the courts regard pets as property similar to jewelry or furniture. Of course, this is shocking to many pet owners who have an emotional attachment to their dog or cat, often regarding them as members of their family. Nevertheless, if you sue a veterinarian for malpractice you are unlikely to get a large settlement.
Psychologists and therapists can also be hit by malpractice claims. Lawyers need professional liability insurance, often called errors and omissions coverage.
What does malpractice insurance cover?
This insurance covers a wide variety of situations that can wrong in healthcare and wellness. These include: misconduct, negligence, errors, omissions, malfunctioning equipment and treatment-related injuries.
Some of the treatment gaps covered can include:
- Failure to monitor
- Failure to inform
- Failure to communicate
- Substandard treatment
Let’s look at some examples:
A nurse failed to monitor the heart rate of a fetus while the mother was in the delivery room at a Toronto hospital. The fetus did not get enough oxygen in the womb, leaving her with brain damage and cerebral palsy. The family was awarded $8 million to care for the disabled child for the rest of her life.
A pharmacist made a mistake and put the wrong drug into a container for a patient’s prescription. As a result, the patient had a bad reaction. The patient sued and was awarded damages and legal costs.
A physician was reviewing a patient’s health history and failed to notice a previous injury that could be aggravated by the treatment recommended. The patient went forward with the treatment, which exacerbated the old injury. The patient sued for damages and costs.
A veterinarian was treating a race horse and accidentally cut the animal’s hoof. While the horse did recover, it was not able to race for several months. The owner sued for the lost income and legal costs.
How much does malpractice insurance cost?
The cost varies widely depending on the profession and services offered. The insurance company will consider previous malpractice awards in the profession since these demonstrate the risks that the insurer is taking on.
The work done by doctors and nurses is high risk since an error could lead to a debilitating injury or even death. By comparison, a massage therapist can cause injury but rarely would their treatments lead to a patient dying.
Some of the key factors in cost of professional malpractice insurance are:
- The profession and services offered
- Training and experience
- The number of employees in the clinic or healthcare facility
- Annual and projected revenues
Who pays for malpractice insurance?
This is an important question. Healthcare organizations, such as hospitals and clinics, usually carry malpractice insurance and pay for it out of their overall budget.
However, this does not necessarily mean that all healthcare practitioners working at such a facility are covered for malpractice. It’s important to check with your employer and professional licensing organization to see whether you are insured.
Do I need malpractice insurance?
Many professions require their members to have malpractice insurance as a condition of being licensed. This includes nurses, doctors and pharmacists.
It is also recommended for a wide range of other professionals, such as dietitians, speech pathologists and audiologists.
Some fitness and wellness practitioners should have malpractice coverage. This includes yoga and pilates instructors.
In addition, it does not matter whether the patient treatment is delivered in person or via the phone or in an online meeting. This is why telehealth professionals should carry insurance.
In summary: Professional malpractice insurance
A wide range of health and wellness practitioners need malpractice insurance. In many professions, such as medicine and nursing, practitioners are required to have coverage as a condition of licensing. Unfortunately, mistakes happen in healthcare and many injured patients, or bereaved families, are turning to lawsuits for compensation.
Wellness providers are at risk too. Massage therapists, pilates instructors and acupuncturists all may need malpractice insurance in the event that something goes wrong. Speak with your insurance broker to find out what coverage you need and how much it will cost.
