Understanding Your Malpractice Policy Can Help Keep You Protected

Many of you have a malpractice insurance policy but may know little about it. Nevertheless, it’s critical to understand the basics of what your policy covers and the necessary requirements for coverage. Taking a few steps can help give you peace of mind about your protection and assure you comply with conditions to maximize your insurance benefits. 

Get to know the declarations.

The declarations—or the first page of the policy—contain critical information: policy number, insured’s name (and corporation name(s), if applicable), dates of coverage, policy limits, premium, and any other fees as appropriate. Get familiar with this information, as well as the dates of coverage (“from” and “to” dates), so that if a claim is reported, you will know if the policy applies. 

Pay attention to renewal notices.

Before your policy expires, the company will remind you to renew several times. About 60 days prior to expiration, AAOIC notifies its insureds of the upcoming policy renewal by U.S. mail and email. You will continue to receive reminders by email every 10 days until your policy is renewed. 

If your policy is not renewed, the company will send a final notice of policy lapse to the insured listed on the policy via U.S. certified mail and email. At that time, the insured will have an additional 30 days to renew. A signed Warranty of No Known Loss will be required, and a $100 policy reinstatement fee may be assessed. If payment is not made within 30 days of the policy expiration date, an application for a new policy with a new effective date will be required and will be subject to underwriting review prior to approval. AAOIC may not make exceptions to the underwriting requirements, so you may not receive special dispensation after discovering your policy has lapsed. Do not let that happen to you! If you ever have a claim, you’ll need insurance. 

To make the renewal process faster and easier for you, AAOIC now offers the ability to renew online. Simply log onto the secure AAOIC site and answer seven underwriting questions. Payment will be accepted electronically at the end. If you are making no changes to your coverage, online renewal is an effective way to assure your coverage remains intact with no lapses.

Pay your premium on time.

Once you’ve renewed, pay the premium on time. Too many doctors fail to pay their premium in a timely fashion. The problem with waiting is that a payment can be overlooked. If that happens, the policy can expire, and your malpractice coverage will end. If a claim occurs during the policy’s lapse, you will be responsible for any losses. And, if there’s a lapse in coverage, you may not be eligible to renew the policy and may be required to re-apply for an entirely new policy. 

If you are required to re-apply and are approved for a new policy, it will be assigned a new effective date, which could leave you with no malpractice insurance coverage in the interim. If a claim develops during that time, you will be faced with handling it on your own. That means you’ll have to pay a defense attorney if there’s a lawsuit. And, if there are any settlements or judgments, you’ll be required to pay those, too. Few doctors have the time, skills, or finances to handle their own claims.

Understand the benefits of your occurrence or claims-made policy.

Though you probably have a malpractice policy already, it’s important you understand which type you have… and the benefits your policy offers.

AAOIC offers a choice of two different types of malpractice coverage—occurrence and claims-made. Before you buy, know the difference between the two and the requirements of each. Talk to the AAO Insurance Sales Representative or the AAOIC Underwriting Department to make sure you have the most appropriate policy for you.

If you are currently insured with another company, knowing the differences in these policies is still important. Understanding your coverage will help you meet all policy conditions and keep it working for you.

Our next article will address more of what you need to know about your malpractice coverage.