Medical Malpractice Tail Insurance is often misunderstood.
How much does tail cost?
Tail costs are determined by applying (multiplying) the factor – {i.e., 1.75} by the expiring premium.
Because this calculus can result in high premiums for physicians and healthcare facilities, it is important to strategize about how to lower the cost.
Physicians and clinical medical groups can save thousands of dollars by structuring their malpractice insurance policies to provide ongoing coverage (tail) for former insured providers.
- Who is included in a ‘tail policy/limit’?
The policies can cover everyone in the practice—from medical doctors to medical assistants. Healthcare facility policies with a rolling tail or a former insured endorsement give you the best features of both types of insurance contracts. There is an occurrence coverage dynamic (i.e. future claims included in the policy), that provides protection for past providers.
Plus, the more affordable current report year pricing of claims made defers the cost of future claims into the future. This combination gives you an affordable premium to help manage that unpredictable future cost of protection for departed physicians.
- Former and Current Insureds covered on one policy
By adding the former insured endorsement to any claims made under the Medical Professional Liability Insurance policy, you give yourself a recruiting advantage.
Most providers will be concerned about how future claims are covered.
This endorsement does not eliminate the cost of tail, but it makes it more manageable, and it gives you the option to provide this benefit.
More thoughts on tail and the important work of recruiting physicians:
》Thoughts to consider when recruiting MDs to groups/policies
Bringing any physician with pending and paid claims into an experienced rated group with retro insurance exposes the group’s overall experience/loss rate.
》Thoughts to consider when carrying a former insured endorsement on an experienced rated policy
Similarly, carrying a formerly insured endorsement exposes that group because the future losses are carried by the group… whereas contractually requiring all cancelling MDs to purchase tail clears the cancelling doctor’s claims from the experience rating calculations.
When you’re ready to select the right policy and the right strategy to better manage the cost of tail and balance the important task of recruitment, The Doctors Insurance Agency is ready to assist.