4 Questions Private Practice Therapists Should Ask Malpractice Insurance Providers
*This article was written by CPH and Associates. The Private Practice Pro does NOT receive compensation of any kind from CPH.
Carrying a professional liability insurance policy is an essential part of establishing your private practice. Professional liability insurance (also called malpractice insurance) protects you against claims or suits arising from the services you provide. The cost of defending yourself against lawsuits and grievances can be prohibitive, and you should ensure that your professional liability insurance is fully equipped to cover your practice. CPH & Associates, a malpractice insurance provider, has compiled these four questions that you should ask about your insurance policy:
As a private practice therapist, do I need individual or corporate malpractice coverage?
If you have an LLC or corporation, you should carry a corporate policy which will cover the business, you as the owner, and your employees (if applicable). If a claim or lawsuit arises from your professional services, it is possible for your business entity to be named in the lawsuit. An individual policy will only cover the individual therapist. An individual policy will not provide any coverage for your business entity for claims, incidents, or lawsuits arising from your professional services.
Does my policy have occurrence or claims made coverage?
There are two types of malpractice insurance policies: Occurrence and Claims Made. Occurrence coverage is lifetime coverage for your policy period. This means that the policy will cover alleged incidents that occur during the policy period, regardless of when the claim is reported. It does not matter if the policy is active when the claim is reported. It only matters that the policy was active when the treatment or incident occurred. For example, a former client may try to sue you for services provided 3 years ago. As long as you were insured at the time of the treatment, your occurrence policy will cover you for future claims.
Alternatively, claims made policies can only cover claims that occur and are reported while the policy is active. Once your policy ends, the coverage ends. At the end of a claims made policy, it is recommended that you purchase a tail policy to provide coverage if a claim is reported after the policy expires. Using the same example of a former client suing you 3 years after you saw them, with a claims made policy, your policy must be active or within the tail period in order for you to receive coverage.
Does my malpractice policy cover me for telehealth services?
With telehealth services becoming increasingly popular, you should confirm that your insurance policy covers you for these services. CPH & Associates’ professional liability policy will cover tele/internet therapy, provided such practice is authorized or allowable under the scope of your license in the state where you practice and provided you are performing such services lawfully. There is no endorsement or additional rider for telehealth services.
Should I add other coverages?
Your insurance policy may allow you to add additional coverages to further protect your practice beyond just malpractice insurance. CPH & Associates provides options to add general liability and cyber liability to protect your practice from bodily injury claims and data breaches.
If you rent or lease an office space where you see clients, you can add general liability coverage to your policy. General liability or “slip and fall” coverage protects you from bodily injury and property damage claims that may occur at a rented office space. General liability can protect you if a client or third party sustains an injury on the premises of your office (including stairways, parking lots, bathrooms, etc.) and holds you liable for the injury.
If you store electronic health records on your computer or server, consider adding cyber liability. Cyber liability is data breach coverage which protects you if an unauthorized third party accesses client information. Cyber liability includes network security and privacy liability coverage and customer notification expense coverage. For example, someone could hack into your server or steal your computer. Cyber liability would cover the costs of conducting a forensic investigation into the breach, notifying affected customers, and notifying the appropriate regulatory bodies.
CPH & Associates provides malpractice insurance for mental health professionals throughout the US. With up-to-date legal resources and exceptional customer service, CPH malpractice insurance can protect your career against malpractice claims/suits and regulatory board complaints. A policy with CPH is tailored to meet your needs, with options to add general liability, cyber liability, and coverage for your LLC or corporation. Find peace of mind with CPH.