Ask a Nurse: What Is Personal Liability Insurance and Should I Get It?
Credit: Inti St Clair / Getty ImagesIn our Ask a Nurse series, experienced nurses provide an insider look at the nursing profession by answering your questions about nursing careers, degrees, and resources.
Question: What is personal liability insurance, and should I get it?
What Is Personal Liability Insurance?
Personal liability insurance can help you financially if you are sued by a patient or their family. It is a type of insurance that protects you from claims brought against you and the service you provide as a nurse.
According to the Nurses Service Organization (NSO), the average cost of a nurse’s malpractice claim is $201,916. Some states require nurses to carry personal liability insurance, but for the most part, it is a personal decision.
Personal liability insurance can also be referred to as:
- Medical malpractice insurance
- Nursing malpractice insurance
- Errors and omissions insurance
Pros of Personal Liability Insurance
Many nursing forums advise nurses to carry personal liability insurance, even if you are covered through your facility. Some nurses believe that despite facilities having coverage for you, they might protect themselves first, referring to it as “throwing you under the bus.”
It is advantageous to have personal liability insurance. If you get sued, facilities might limit coverage, and you could be responsible for the rest of the claim. This is when your personal liability insurance kicks in.
Other pros to personal liability insurance include:
Covers medical negligence- Covers failure to follow the Health Insurance Portability and Accountability Act and protect personal healthcare records
- Covers misrepresentation
- Covers incorrect advice
- Pays for legal fees like defense, judgement, and settlement costs
- Pays for loss of income from attending trials and/or dispositions
Cons of Personal Liability Insurance
While personal liability insurance can be helpful, it may not be the best choice for everyone. One of the main deterrences of personal liability insurance is cost. Although costs vary, if it’s not in your budget, then you may opt out of carrying insurance. Some nurses also have additional medical malpractice insurances, which can get pricey. Other cons include:
Limited coverage- Complicated language and complex policies
- Gaps in your coverage dates
Why Do Nurses Get Sued?
Nurses get sued for many reasons. Some states allow patients to sue nurses and/or doctors for up to 10 years. One reason nurses are sued is because of negligence that caused harm to a patient or death. Another reason is because of allegations related to the treatment and care provided by the nurse or healthcare team.
Nurses also get sued for:
- Medication errors
- Unprofessional conduct
- Failure to take action
- Injury
What Are Different Types of Liability Insurances?
You can choose between two types of liability coverage to add to your personal liability insurance. It is up to you to do your research and decide which coverage is best for you. The two types of liability coverage are claims made and occurence based.
Claims-made Insurance Coverage
With claims-made insurance coverage, your insurer will cover claims filed during your policy period with added features such as a retroactive date or an extended-reporting period.
A retroactive date is when a claim is made during your policy period but the incident happened before your policy period. The retroactive feature allows the insurance company to help cover the claim.
An extended-reporting period covers claims during a certain period after your policy coverage has ended. It typically lasts 30-90 days after the policy has ended.
Occurrence-based Insurance Coverage
Occurrence-based insurance coverage is an additional policy that covers you during your policy period regardless of when you file a claim. This type of coverage is pricey because of how long the policy is active.
Additional Insurances
There are different types of liability coverage, too. You may choose to have personal liability insurance and add additional insurances. Others include:
- Workers’ Compensation Insurance: This covers work-related injuries to help pay for healthcare bills or additional treatment like physical therapy.
- Commercial Property Insurance: If you own a business as a nurse, commercial property insurance can help protect your home or office. It can also protect medical equipment such as blood pressure machines and monitors.
How to Pick the Right Coverage for You
To pick the right insurance coverage, do your research. You don’t want to pay for coverage that may not be right for you. Ask other nurses which policies they hold and how happy they are with it. To get a policy, most insurance companies will give you a quote, then allow you to pick a policy online or over the phone.
According to NSO, the majority of claims resolve for less than $100,000. But 3.1% of claims are paid the total policy limit of $1 million. How much you pay monthly or annually for personal liability insurance varies by insurance company and state.
No one wants to get sued, but it is better to be prepared if it happens. Being sued doesn’t only happen to new nurses either. According to NSO, experienced nurses are more likely to be sued than new nurses. I see personal liability insurance as getting it and then forgetting about it. Just remember to renew when the policy has expired.
In Summary:
- Personal liability insurance can help you financially in case you are sued by a patient or their family.
- Nurses can get sued because of negligence that caused harm to a patient or death.
- To pick the right coverage, do your research. Ask other nurses which policies they hold and how happy they are with it.
In our Ask a Nurse series, experienced nurses provide an insider look at the nursing profession by answering your questions about nursing careers, degrees, and resources.