COVERAGE CORNER

In our feature, Coverage Corner, we will answer your questions about coverage issues and risk management concerns.

A young Florida physician, completing two years of employment and planning to relocate to another state asks: Do I have to buy the “Tail” policy on my medical malpractice insurance? Are there any other options? Well, you have to if you want to be able to report and have coverage for any claim arising from your two years of practice in Florida. Or, if you are bound by an employment contract to purchase the “Tail” endorsement policy upon your termination/resignation, and you have decided not to, well, time to contact your attorney. But, in Florida, there is no statutory requirement to purchase a tail endorsement. If you elect not to purchase the Tail endorsement, then for all intents and purposes, you are going “bare” for those years, and in fact self-insuring that time period’s practice exposure. Florida statute allows physicians to self-insure, so long as they comply with their financial responsibility in the event of a claim. Going bare is usually the option of last resort. A decision to go bare creates a coverage "gap". A gap in coverage is viewed negatively by underwriters, and may effect your eligiblity for policy discounts in the future. In regard to other options, well the first option is to determine if you can keep your retroactive date from your years of practice in Florida and purchase (in this case) a third year policy from your new insurance carrier, thereby continuing coverage with your same retroactive date. This would enable you to report any claim from your Florida practice to your new insurance carrier. Better still, see if your Florida insurance company writes coverage s in other states, including your new state of practice. Perhaps they can make rate adjustment to your premium to allow for the “run-off” of the high premium years of practice in Florida, a relatively “higher-risk” state for malpractice claims. If you rule out that option, you may be able to purchase a “Stand-Alone” Tail on your Florida practice, at a reduced premium, from another carrier. Our agency represents several companies that sell a “Stand-Alone” Tail product. The most important thing is to make an intentional, informed decision, with the guidance of your agent. We assist our physician clients with questions like these all the time. Call us if we can help! 866-321-8745.

Have a coverage question or risk management concern? Email your question to bbrown@cadls.com.