Because the relationship with your professional liability carrier is long-term, you need to thoroughly understand how that relationship is defined. If you don’t, you may sign up for a policy that isn’t the best fit for your needs, or worse you may not understand your coverage or your rights.

Read your Policy and ask questions, do not stay in the dark and wait until you have a claim, make sure the policy you purchased is worth the money that you spend. Do not buy a policy based on rates, ask about the company, is it a real insurance company, is it a trusted company, or risk retention group, you need to avoid both tryst companies and risk retention because of potential financial harm to you and your assets. Again, read your policy.

Some professional liability carriers establish premiums at the beginning of the policy period and, absent any change by you during the policy period, are guaranteed not to increase during the policy period, regardless of any adverse loss development experienced by the company for that policy year. Other professional liability companies are “assessable” companies. This means that the premiums paid by policyholders at the beginning of a policy period are estimates only. If an assessable company has losses or expenses that exceed the premiums collected, they can collect extra premium (i.e., assessments) from policyholders-possibly even after your policy period ends or your policy is cancelled.

How much control does the policy allow an individual physician to have when making the decision to settle a claim? After all, settling a claim involves more than money-it can impact your reputation, your practice and even future insurability. Who decides if the claim will be presented to a jury? The insurer? An arbitration panel? If you object to settlement and the trial verdict is higher than what you could have settled for, will you be personally liable?

Ask if you have a voice in your defense. Know what rights, if any, the policy gives you if settlement is considered.

Whether you have a claims-made or occurrence policy, you need to understand what triggers coverage. Does the claims-made policy, for example, allow you to trigger coverage by reporting medical incidents you reasonably believe could result in a claim? If not, when can you trigger coverage? Do you have to wait for a formal demand for damages or lawsuit before the policy responds?

What if there is a change to the policy terms or conditions? Will you receive advance, written notice? Will you have the opportunity to examine your options and secure alternative coverage if necessary?

Your policy will most likely provide professional liability coverage on either an occurrence or claims-made basis.

Occurrence coverage responds to claims based on when the medical incident occurred, regardless of when the claim is actually made against you. As long as the medical incident occurred during the policy period, your occurrence policy will respond--even if the claim is made after the policy period expires.