Medical practice insurance refers to multiple business policies that cover the risks physicians and dentists commonly face. Many healthcare providers qualify for a business owner’s policy (BOP), which costs $600 – $3,500 annually. However, BOPs don’t usually cover medical malpractice, so physicians also need professional liability. That policy typically costs $10,000 per year.
Cost shouldn’t be the only concern physicians and dentists have when it comes to business insurance. They should also consider a policy’s features, or they may find themselves with insufficient coverage when they need it the most. The Hartford can help medical practitioners get appropriate and affordable insurance through customizable policies they can buy online.
Dental & Medical Business Insurance Providers
The risk healthcare professionals face cause some insurance providers to decline their applications for coverage. Therefore, doctors and dentists may need to consider both well-known business insurance companies and small specialty insurers. Either way, they should also look for financially sound companies so they can trust the company will pay covered clams if the time arrives.
Top Medical Business Insurance Providers
|The Hartford||Physicians and dentists who want customizable business insurance policies|
|Markel Specialty||Physicians and dentists who want discounts on their medical practice insurance|
|AP Intego||Physicians and dentists who want to simplify their workers’ compensation insurance premiums|
|Liberty Mutual||Physicians and dentists who want broad coverage that includes equipment breakdown|
|CNA||Physicians and dentists who want one carrier for their property and professional liability insurance.|
Healthcare professionals may also want to get quotes from insurance brokers. That’s usually an easy way to see offers from multiple carriers in one setting, but they should still research any carrier before they buy coverage.
The Hartford is a small business insurer with a long history of writing business insurance policies in many industries. They’re known for both their quality coverage and solid financials, earning high marks from top credit rating companies.
Physicians and dentists should look to The Hartford when they want business insurance that’s highly customizable. The Hartford offers five endorsements for their medical practice business owner’s policy, including coverage for cloud service interruptions, spoiled medicines, and business interruption. Moreover, small practices can add valuable endorsements for employment practices and data breaches that many other insurers only offer as standalone policies.
Markel Specialty develops insurance products for niche industries where business owners sometimes struggle to find affordable coverage. For medical and dental offices, Markel offers a business owner’s policy that covers employee theft, valuable papers, and outdoor signs.
Markel Specialty couples that broad coverage with discounts on their partners’ services. Health practitioners can find savings on employee background checks and risk management training, and those who join the National Federation of Independent Business get a 5% discount on their BOP premiums, making Markel the ideal choice for doctors and dentists looking to save money.
AP Intego is an online agency that specializes in small business insurance and can get quotes from top-rated insurers including Berkshire Hathaway GUARD, Travelers, and AmTrust. Healthcare professionals submit their basic business information to these and other insurers through a single online application, and AP Intego’s platform returns quotes in a matter of minutes.
In addition to a fast application process, AP Intego offers pay-as-you-go workers’ compensation that integrates with your payroll service. This lets physicians set up automatic premium installments based on each month’s actual payroll rather than a full-year estimate, and makes AP Intego the optimal choice for business owners who want to simplify their workers’ comp payments.
Liberty Mutual is well known for their home and auto insurance, but the company also offers industry-leading commercial products backed by solid financial resources. Healthcare is one of the carrier’s top industries, so they offer a full lineup of dental and medical business insurance products including general liability, commercial property, workers’ compensation, and umbrella liability.
Liberty Mutual is the optimal choice for doctors and dentists who want to protect their high-value equipment. The company’s BOP not only includes equipment breakdown coverage, but it has property coverage specifically designed to protect medical, surgical, and dental equipment, tools, and supplies.
CNA is one of the largest property and casualty insurers in the U.S., and one of the only providers that focuses solely on small business insurance. As a result, CNA has deep industry expertise in nine industries and hundreds of professions, including healthcare providers’ offices.
CNA offers the common dental and medical practice insurance, including BOPs, but they can also write unique policies for practitioners who have international or product liability. Moreover, CNA can write healthcare professional liability, and that makes them the ideal one-stop shop for physicians and dentists.
How Dental & Medical Practice Insurance Works
Medical business insurance protects healthcare providers’ assets in case they’re accused of harming others physically or financially. These accusations take many forms, each of which is covered by a separate policy. One example is general liability, which covers a patient’s doctor bills after a slip-and-fall or the provider’s legal fees if the patient sues.
Small providers’ offices may qualify for a business owner’s policy (BOP), which is a package that typically includes general liability and commercial property insurance. BOPs are usually less expensive than buying policies separately, costing between $600 and $3,500 per year for doctors and dentists.
Types of Dental & Medical Practice Insurance
Like any small business owner, physicians and dentists need general liability and commercial property insurance to protect their assets from the cost of some of the most common business risks. However, health professionals have additional concerns, including malpractice lawsuits and cyberattacks, which require other dental and medical business insurance policies.
Most Common Types of Dental & Medical Business Insurance
|Type of Insurance||What it Covers|
|General Liability Insurance||Property damage, physical injury, and advertising injury claims made by third parties|
|Commercial Property Insurance||Damage to business-owned property caused by external forces|
|Malpractice Insurance||Allegations of professional negligence, errors, and omissions made by patients|
|Workers’ Compensation Insurance||Lost wages and doctor bills for employees who suffer work-related illnesses and injuries|
|Cyber Liability Insurance||Costs associated with data breaches and cyberattacks|
|Equipment Breakdown Insurance||Damage to business-owned equipment caused by internal forces|
Common types of dental and medical business insurance include:
General Liability Insurance
General liability insurance covers third-party allegations of property damage, physical injury, and advertising injury, such as libel and slander. Third parties are essentially anyone who comes into contact with your business who isn’t an employee. If a non-employee claims you caused them a financial loss, general liability kicks in to help cover the potential costs.
Some costs that are usually covered by general liability insurance for medical practices include:
- A neighboring office’s bills for smoke damage after a short in your autoclave starts a fire
- A patient’s hospital bills for a dislocated shoulder after slipping on your recently waxed floors
- Your legal fees if a colleague sues for defamation after reading your remarks on their research in the local paper
Most general liability insurers offer to cover an injured party’s medical or repair bills in hopes of reducing the chances of going to court. However, insurers typically pay their policyholders’ attorney’s fees, court costs, and any settlements or judgements if there is a lawsuit.
Commercial Property Insurance
Commercial property insurance covers your business-owned property when it’s damaged by external events such as fire, vandalism, and theft. Business-owned property typically includes the building where your practice is located and its contents. However, physicians and dentists who rent their business space can get property policies that only cover their equipment, furniture, and fixtures.
Physicians and dentists with small practices can often get commercial property insurance bundled with general liability in a business owner’s policy. This is often a more cost-effective way to get these fundamental coverages, plus the insurer often add business interruption coverage to the package.
Malpractice insurance is a professional liability policy specifically designed for healthcare professionals. It pays your legal fees, including judgements and settlements, if a patient claims your error, omission, or negligence caused physical harm.
Events typically covered by malpractice insurance include:
- Misdiagnosis: Diagnosing a patient with a chest cold when they turn out to have a blood clot
- Surgical errors: Removing the wrong kidney during surgery
- Mistakes in reading lab results: Transposing numbers in a liver panel
- Failure to order proper testing: Failing to order a complete blood count so a patient’s leukemia diagnosis is delayed
Doctors and dentists often have to go to insurance carriers that specialize in medical malpractice for coverage.
Workers’ Compensation Insurance
Most states require employers to carry workers’ compensation insurance to cover their employees’ on-the-job injuries and occupational illnesses. Policies typically pay for the injured employee’s medical bills and lost wages or death benefits to their families.
Depending on state law, workers’ comp insurance includes coverage for things like:
- Repetitive stress injuries, such as carpal tunnel from years of writing prescriptions
- Sudden traumatic injuries, such as back strain from helping a patient off an exam table
- Occupational diseases, such as exposure to bloodborne pathogens
Doctors, dentists, and their staff have a low risk for work-place accidents, and their workers’ compensation rates typically reflect this. Healthcare business owners can expect to pay between 18 cents and $2.66 per $100 of payroll.
Cyber Liability Insurance
Cyber liability insurance covers both first-party and third-party costs that follow data breaches. First-party coverage pays the costs you incur for breaches to your network, such as patient notification and investigations into the attack. Third-party coverage pays claims made by others, including fines and other legal fees.
Cyber liability coverage is essential for any business that stores client information, but healthcare professionals have even greater concerns because of the Health Insurance Portability and Accountability Act (HIPAA). While the purpose of HIPAA is to help consumers maintain coverage, the law set high security standards for health practitioners
Equipment Breakdown Insurance
Commercial property only covers damage caused by outsider forces, so most healthcare offices also need equipment breakdown insurance to pay for costs associated with malfunctioning equipment. These expenses typically include repair bills, but policies may also cover spoiled medicines and supplies as well as business recovery expenses, including cleanup and debris removal.
Equipment breakdown insurance can apply to specialized medical equipment, but policies also cover other property. For example, equipment breakdown coverage often pays for repairs to air conditioning and refrigeration systems that malfunction, short circuit, burnout, or malfunction.
Additional Medical Business Insurance Policies
The medical practice insurance policies listed above cover most of the risks of traditional physicians’ and dentists’ offices. However, mobile services, large staffs, and other unique operations may mean healthcare professionals require additional insurance policies.
Additional business insurance policies healthcare offices may need include:
Inland Marine Insurance
Inland marine insurance is a type of property coverage for equipment and other business-owned items as they move between locations. Mobile physicians and dentists most likely need this coverage, but some insurers offer specialized inland marine for medical equipment, such as colposcopes, MRIs, and centrifuges.
Valuable Papers & Records Coverage
Physicians and dentists may also want to get a valuable papers and records endorsement. This inland marine policy helps pay to restore valuable records including printed documents, data processing programs, data, and media. This coverage is typically included in a BOP, but offices with extensive records may need an endorsement with higher limits.
Commercial Crime Insurance
Commercial crime insurance covers financial losses stemming from criminal activity, often replacing stolen money, even when it’s taken by an employee. This policy covers a gap in commercial property policies, which exclude employees’ actions, monies, and securities from coverage.
Employment Practices Liability Insurance
Employment practices liability insurance (EPLI) pays for your legal fees, including judgements or settlements, if a current or former employee or job candidate sues you over employment-related issues. Common EPLI claims include accusations of sexual harassment, discrimination, and wrongful termination.
Umbrella Liability Insurance
Umbrella liability insurance extends coverage on underlying liability insurance. For instance, if a slip-and-fall lawsuit maxes out your general liability limits, an umbrella policy pays the remaining costs. Umbrella insurance can do this for multiple liability policies; however, it usually does not extend the coverage of malpractice insurance.
Dental & Medical Practice Insurance Costs
Estimating your dental and medical practice insurance costs is tricky because they are partially dependent upon the policies and the coverage amounts you select. Malpractice insurance further complicates cost because rates vary by state and specialty. At the very least, most practitioners need BOPs that usually cost between $600 and $3,500 per year.
Dental & Medical Business Insurance Costs by Policy
|Insurance Type||Annual Premium||Coverage Amount||Typical Deductible|
|General Liability Insurance||$350 - $800||$1 million per occurrence / $2 million aggregate||$0 - $1,000*|
|Business Owner’s Policy||$600 - $3,500||Liability: $1 million / $2 million|
Property: Varies based on value
|Malpractice Insurance||$2,000 - $34,000*||$1 million per occurrence / $3 million aggregate||$2,500 - $10,000|
|Workers’ Compensation Insurance||$200 - $9,000||Not applicable||$500 - $5,000|
*Costs vary based on location and specialty. High-risk practices pay more for malpractice insurance.
Policy types and coverage amounts are just two factors insurers consider when determining your dental and medical business insurance costs. They also look at your deductible and business characteristics such as total revenue and claims history.
Additional factors that may impact your premium include:
- Deductibles: Selecting a higher deductible usually lowers your premium because you’ve taken on more responsibility in the event of a claim.
- Claims history: The more claims a business files, the riskier that business looks to insurers. This leads insurers to charge higher premiums to protect their bottom line.
- Location: Insurance costs more in some states, but your premiums may even go up if your business is located in an area with high crime or flood risks.
- Revenue: In some lawsuits, a judgement against you often reflects the amount of money you earn, so businesses with more revenue tend to pay higher insurance premiums.
- Employees: As you add employees, your risk of employee injury goes up, as does the likelihood of theft and third-party claims, causing an increase to your medical practice insurance costs.
Tips on Getting Dental & Medical Practice Insurance
Getting the right dental or medical practice insurance for your business requires a little bit of legwork. If you purchase the first policies you’re offered, you may spend more than you need to. Worse, you might end up underinsured.
Here are three things you can do to get quality coverage for your practice:
1. Gather Your Information
When you apply for dental or medical practice insurance, you give carriers some information about your business. They use this information to determine if they want to cover you, create your quote, and ultimately set your premium. More importantly, providing false information is a reason for carriers to deny claims, so you want your information to be as accurate as possible.
Some of the information you need to have includes:
- Address and contact information
- Claims history (at least the past three years)
- Equipment details, including the type and cost
- Policy information for any current coverage
- Annual revenue
- Number of employees
- Details about HIPAA controls and medical waste handling
You need this information whether you are applying online or working with an agent.
2. Get Multiple Quotes
It’s a good idea to get more than one quote when you’re shopping for dental or medical practice insurance so you can compare proposals. One easy way to get multiple quotes is to use an independent agent who can shop different carriers for you and review each proposal based on price and value.
3. Work With an Agent Who Knows the Healthcare Industry
Healthcare, like any industry, has its quirks, so you want to work with an agent who knows what the risks are and how to cover them. For instance, an agent who has written medical business insurance policies before will know about coverages for HIPAA regulations and expensive equipment. They can also help you set up best practices for managing these risks, and you can check in with them on a regular basis.
“The biggest mistake doctors and dentists make is not having their policies reviewed every couple of years by a risk adviser, not an insurance broker. Offices change, insurance rates change, and circumstances change. One dentist I worked with only had liability insurance—but no coverage for the building he just renovated and no coverage for the new dental equipment. He did not know he had no coverage if the building burnt down. That is why the policies need to be looked at every couple of years.”
– Stuart Schwartz, Senior Risk Advisor, Milton Choto/Scott Roberts Agency
Dental & Medical Business Insurance Frequently Asked Questions (FAQs)
Below are answers to a few of the most frequently asked questions about dental and medical business insurance.
Is dental or medical practice insurance required by law?
While there isn’t a federal law that requires doctors and dentists to get business insurance, some states statutes do. One example is workers’ compensation insurance, which is required in all states except Texas. Moreover, 32 states require physicians to carry malpractice insurance.
Does malpractice insurance cover HIPAA violations?
Whether or not medical malpractice covers HIPAA violations depends on both the policy and the violation. Malpractice can be defined as failing to exercise a reasonable standard of care, and violating a patient’s privacy may meet that definition. In that case, malpractice coverage may pay for the physician’s legal fees.
How much does a data breach cost a healthcare business?
According to a study by the Ponemon Institute and IBM, the healthcare industry has the most expensive data breaches, averaging $408 per record. This is partly due to HIPAA penalties, but the cost can include Federal Trade Commission fines, credit monitoring for patients, and lawsuits. Cyber liability insurance can help practitioners cover these costs.
Doctors and dentists find themselves facing a number of exposures that can threaten their practices. Malpractice claims, HIPAA fines, and damage to equipment are some of the most expensive threats, but practitioners are also exposed to the same risks any business faces. These exposures make medical practice insurance critical to their business success.
The Hartford can help healthcare professionals get the coverage they need to protect their businesses. Physicians and dentists can apply online and get quotes for medical practice insurance in just five minutes.