How much malpractice insurance to buy?

[drjukes]

Hello, I was wondering if anyone could give me advice regarding how much malpractice insurance to buy. I am in my last year of residency (PM&R) and will be a 1099 independent contractor for a private rehab hospital starting in July. Currently, i've paid off all my student debt and have about 150k in assets but I anticipate that number rising once I start working. My dilemma is how much malpractice insurance should I purchase (250/750k, 500/1.5mil, or 1mil/3/mil policies)? The best quotes I was given came from The Doctors Company and are as follows...

250k/750k

1st year 2,472, 2nd year 4,238, 3rd year 5,650, 4th year 6,498, after 7,063 with discounts based on claim free years

500k/1.5mil

1st year 3,390, 2nd year 5,811, 3rd year 7,748, 4th year 8,910, after 9,685 with discounts based on claim free years

1mil/3mil

1st year 4,134, 2nd year 7,087, 3rd year 9,449, 4th year 10,866, after 11,811 with discounts based on claim free years

 

I have gotten mixed advice from people as some told me to purchase the 250k/750k malpractice insurance because it makes it less likely people will go after me in the event of a lawsuit while others have told me to make sure I am insured for at least the amount of assets that I have in non-asset protected accounts. Any advice would be appreciated!

[VagabondMD]

To some degree, this is dependent on your state laws and community standards, but just about everyone I know carries $1M/3M.

When they file a suit against you, they do not know how much insurance you have, and a significant amount of the $250k can be eaten up by the cost of discovery. And while they might not be able to attach a judgment to your protected assets, they could potentially attach it to your future revenue stream (depending on state law). As a young physician, that is not a risk I would want to take.

So I ask you, “Do you feel lucky?”

[CordMcNally]

1mil/3mil without a doubt. I know the price difference will make you hesitate but that's cheap insurance for your future earnings.

[drjukes]

Thank you both for your responses! I live and will be practicing in Florida.

[jbmitt]

Highest that you can afford. I’d also suggest 1m/3m. We know of people in FL in OB/GYN who go bare with no coverage based on the litigation environment.

What I’m told, (I haven’t looked into it more to confirm) is that the plaintiff attorneys will take whatever you have if there is a claim with merit against you, so it’s a disincentive to carry coverage. I’d presume that you may be able to shield earnings in real estate, retirement accounts, and joint accounts with spouses.

I’d never agree to that.

[Hatton]

You want what the others in your community and speciality carry.  I agree 1/3 million.  I don’t know any “bare” OBs.  Most of us actually use the insurance at some point.

[Molar Mechanic]

1M3/M.  2/4 if it's not a small difference.  Pay for the option to settle if you can, especially if you pay the higher amount.  I don't remember where I saw it written (perhaps here), but one doc talked of having enough insurance to ensure they got the legal "A-Team" on his defense.

 

Practicing in Florida...you cannot have enough insurance!