Risks of practicing without coverage

You wouldn’t risk driving a car without insurance.  Nor would you go without health insurance.  Going without malpractice coverage is just as risky financially.  Because your career and reputation are at stake, you have a lot more to lose than just your savings. 

Consider this - the average cost of a malpractice claim against a nursing professional is $164,586. Even if you win the case, you’ll have attorney fees to pay. The average cost of legal expenses to defend a malpractice lawsuit against a nurse is $37,084.*   

With a $109 average yearly premium, it’s easy to see how having your own policy makes sense.  
 

But nurses don’t get sued. 

It’s a misconception that only physicians and hospitals get sued for malpractice.  That simply is not the case.  All licensed healthcare professionals, including nurses, are held accountable for their work.  And they can all be sued. 

Over our last 5-year malpractice claim study period, NSO’s underwriter CNA paid out over $90 million in nurses’ malpractice claims for over 10,000 reported incidents.*  In today’s litigious society, when something goes wrong, everyone gets sued, including the attending nurse. 
 

But I am careful.  I don’t make mistakes. 

Bad outcomes occur. You don’t even have to make a mistake to be the target of malpractice allegations.  Everything can be done correctly, but there is a bad outcome for the patient. Also, today’s healthcare system relies upon a value chain of healthcare professionals. One mistake by another provider can bring you into a lawsuit. Sadly, no matter how dedicated you are to your profession and your patients, should something go wrong, someone can get hurt.  That generally results in a lawsuit against you, your employer, and anyone else involved in the incident. 

While frivolous lawsuits get dropped or dismissed by the court, you’ll still have to mount a legal defense.  With current attorney fees, and cases lasting anywhere from a few months to a few years, without insurance you can quickly go through your life savings. 
 

But I am covered by my employer.  

You may have some protection through your employer’s insurance, but it’s a mistake to rely entirely on employer-provided coverage as it can have serious gaps in protection.   

Your employer’s policy is only for malpractice claims.  Anything that involves your state licensing board, is not covered by your employer.  Last year, there were thirty-six times more licensure complaints filed against nurses than malpractice claims.**    

If a complaint is filed against you, you could appear before your licensing board unrepresented, but that’s not a good idea.  Your ability to practice and earn a living are on the line.  The average cost to have an attorney represent you before a state licensing board is $3,988. Your employer’s insurance will not help.  On the contrary, your employer could be the one filing the complaint against you.   

Your individual coverage provides $25,000 of License Protection that allows you to hire an attorney, who can help you craft a response to the complaint letter and appear at the board of nursing hearing with you.   
 

But if I am sued and don’t have insurance, they’re not going to take my assets. 

That too is a misconception.   

The judge and jury have no idea whether you have insurance.  Should the verdict go against you, the judge will convert the jury verdict into a court order.  If you or an insurer on your behalf does not pay the court order, this creates an unsatisfied judgment. 

An unsatisfied judgment against you is much more damaging to your credit than bankruptcy.  As long as it remains unpaid, you could have trouble getting a credit card, a loan or a mortgage.  The plaintiff’s attorneys can file a motion to enforce that judgment.  If granted, it means your wages can be garnished and they can seize your children’s college savings. 

When you look at the risks of practicing without professional liability insurance—and the annual cost of coverage, it’s a small price to pay to maintain your finances, your career and your peace of mind. 

*Nurse Professional Liability Exposures: 2015 Claim Report Update, NSO, CNA, October 2015. 
**National Practitioner Data Bank, U.S. Department of Health & Human Services, September 2019. 
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Frequently Asked Questions

You have questions. We have answers. (It's why we're here.)



What kinds of activities might trigger a disciplinary action by a licensing board or regulatory agency? 


The fact is anyone can file a complaint against you with the state board for any reason—even your own employer—and it doesn’t have to be solely connected to your professional duties. All complaints need to be taken seriously, no matter how trivial or unfounded they may appear. 


How does a shared limit policy work?


A shared limit policy is issued in the name of your professional business or company. The policy provides professional liability insurance coverage for the business entity named on the certificate of insurance and any of the employees of the business entity, provided they are a ratable profession within our program. Coverage is also provided for locum tenens professionals with whom the business entity has contracted for services the locum tenens performs for the business entity.

The business, and all eligible employees and sub-contractors you regularly employ, will be considered when determining your practice’s premium calculation and share the same coverage limits you select for the business.


We have a shared limit policy. Are employees covered if they practice outside our office?


The policy covers your employees outside the office as long as they are performing covered professional services on behalf of your business.

If your employees are moonlighting, either for pay or as a volunteer, they should carry an individual professional liability insurance policy to cover those services. Otherwise, they might not be covered for claims that arise out of these activities.



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