Why Didn’t Anyone Teach This in Residency?

A Guest Blog by Rich Stagnato, PRMS Accounts Representative

Private practitioners who need to keep track of reimbursement for their services and maintain records can find that keeping track of medical malpractice policies can also be a challenge.

Some insurance companies promote claims made policies as the only or preferred option but, in reality, there are other choices available. Through The Psychiatrists’ Program®, we offer a variety of options. Let’s navigate them now.

An “occurrence” policy responds to claims resulting from incidents which occur during the policy period, regardless of when the actual claim is made. Coverage need not be in force at the time the claim is reported. It is only necessary that coverage was in force at the time the alleged negligence occurred. The main thing to take away is that you don’t need to buy tail coverage (a tail allows you to report claims that occurred during the policy).

A “claims made” policy responds to claims/lawsuits reported during the policy that occurred after coverage starts (retroactive date). As long as the “claims made” policy is renewed, coverage will apply. If the policy is canceled by you or the insurance company, tail coverage may need to be purchased. A tail at no additional charge may be available to those who meet certain guidelines. If you plan to stay with The Psychiatrists’ Program® long term, this may offer savings – sometimes significant savings. If you are currently insured with a “claims made” policy from another company, we can transfer your current coverage (retroactive date) to your new policy – there is no need to buy tail coverage. Therefore, claims you would have reported to the other company may now be reported to our program. In many cases, our rates for this retroactive coverage (also called prior acts or nose coverage) are lower than your current company’s tail coverage rate. A “modified occurrence” or “claims made with prepaid tail” policy is available in some states instead of an “occurrence” policy. With these policies, you can also report claims that occurred when coverage was in force. You will not need to pay any additional premium at the time of cancellation for the tail coverage.

If you want clarification how tails and noses (oh my!) apply to you – if at all – please feel free to contact us at (800) 245-3333 x389.

Rich Stagnato, PRMS Accounts Representative Richard Stagnato rejoined PRMS in 2004 after almost a year as an underwriter at NCRIC. Prior to joining the company in 2000, he had been an insurance specialist for five years with the Boat U.S. insurance program. Mr. Stagnato is responsible for sales and procurement of individual new business, providing customer service, insurance counseling as well as obtaining competitive data on the medical malpractice market. He is a licensed Property and Casualty agent.