Transcription:
Part 1: Everything You Ever Wanted to Know About Malpractice Insurance

VO: This podcast is intended to provide information only on certain risk management topics, and is not to be construed as providing legal, medical, or professional advice of any form whatsoever. Because federal, state, and local laws vary by location; nothing in this podcast is intended to serve as legal advice or to establish any standard of care. Legal advice if desired, should be sought from competent counsel in your state.

Host: Hello and welcome back to Forecast. The podcast designed to help dental students move forward in their practices. Brought to you by Fortress Insurance, the leading professional liability insurance coverage provider for dentists. Not familiar with Fortress Insurance yet, get in touch with Fortress and find an agent by visiting our website at dds4dds.com.

That's d-d-s, the number four DDS dot com. I'm Dr. Julie Goldberg, the education program developer at Fortress Insurance, and for those of you who listened to our first two episodes on the basics of contracts, welcome back and thanks for tuning in again. For those of you who are new, welcome to Forecast and to Fortress Insurance, we're so glad you're joining us, and if you missed an episode, be sure to check out our other recordings at your convenience. Today, marks the start of a two-part series on a very important topic; malpractice insurance, also known as professional liability insurance. To help us with that, we've brought in an expert in the field, Frode Brudvik. Frode has a lot of background and perspective and will walk us through professional liability insurance concepts. Frode, please tell our listeners a little bit about yourself.

Guest: Julie, it's great to be here. Thank you for having me. I'm the Vice President of Underwriting with Fortress Insurance. I've been in the insurance industry over 20 years helping practitioners find the malpractice coverage they need to protect their practice. I've worked specifically with dentists and dental specialists for the last 15 years.

Host: So Frode, tell us what our listeners can expect to hear about over these next two episodes.

Guest: Sure I'd be happy to. Today we're going to cover the basics of malpractice insurance for dental professionals to provide them some background to consider as they begin their practice. In our second part, we'll do a deeper dive into additional details related to malpractice insurance.

Host: Okay, so let's start by telling our listeners what dental malpractice insurance is.

Guest: Sure. Dental malpractice insurance protects dentists in the event a patient alleges that negligent acts occurred that harmed them. In addition to providing peace of mind, malpractice insurance is required to practice dentistry in most jurisdictions. However, requirements vary by jurisdiction, so it's very important that you know your state and practice guidelines.

Host: This is a really great tie in to our previous episodes, Frode. In our first episode, we outlined how important it is for new dental professionals to surround themselves with a trusted support team made up of an attorney in their state, a qualified accountant, and of course a Fortress agent.

Guest: I'm glad you brought that up, especially with something as important as malpractice insurance. There are so many details that will need to be reviewed by one or more professionals on a support team. So while I'm giving you the basics of malpractice insurance, there's really a lot that goes into it. I can't stress this enough. Work with your support team to understand all of the details that affect your unique situation.

Host: That's a really good point, Frode. Malpractice insurance necessity and coverage can vary by locality and details of each doctor's policy may be unique. So be sure to consult to professionals on your team.

Guest: Yes and understand the why to its importance is crucial. Let's face it, it can help to protect the future of your dental career. No one ever thinks they'll be faced with a lawsuit, but they are more common than you think. Malpractice insurance can help protect your assets by providing defense and indemnity coverage.

Host: So Frode, you mentioned indemnity coverage. What does this term mean?

Guest: Great clarifying question, Julie. The defense costs in a professional liability claim are those costs paid to defense attorneys for the dentist. The indemnity is the amount paid, if any, to the plaintiff or patient in the claim. In addition to covering these costs, malpractice insurance can help alleviate some of the stress associated with filed claims, for sure. Our claims professionals handle dental claims every day, and when confronted with a claim, you want an expert by your side.

Host: That's a great point, Frode. Having an expert on your side is critical, whether you're an associate dentist or an ownerof the practice. In our first two episodes, we discussed clauses that may be included in employment contracts, one of which was the requirement for malpractice insurance coverage.

Guest: Exactly. The employer wants to make certain that malpractice insurance is in effect for employee dentists because it protects the employer, often the practice owner, against liability that may arise from allegations of the employee dentist. The employee dentist will want to be invested in this as failure to have adequate insurance in place can be in violation of applicable state laws mentioned earlier, and should a malpractice claim arise, be financially disastrous.

Host: So Frode, I know you're going to share more details about contract considerations in our next episode. So let's start now by telling our listeners some of the basics they should know about professional liability insurance.

Guest: I'll start by identifying two types of policies that make up dental malpractice insurance. It's occurrence and claims made. Both policies cover the same claims, but how they're structured differ. Each has its advantages and disadvantages that should be thoroughly discussed with your insurance agent when purchasing your policy. Let's briefly look at each. An occurrence policy provides coverage against allegations of malpractice, which occurred during the policy period, regardless of when a claim is reported. The occurrence date is the trigger for the coverage to apply. For example, if you treated a patient in 2019 and that patient files a claim against you for that treatment in 2021, the 2019 policy will respond because that's when the injury occurred. Occurred being the key word here. With occurrence coverage, the policy will remain available to you forever or until the limits for a specific policy year exhausted.

So claims made policy, a little bit different. It also provides coverage against allegations of malpractice. But unlike the occurrence example, the policy that would respond is the policy in force when the claim is reported. The reporting of the claim is the trigger for the coverage to apply. So let's take the same example as before.

If you treated a patient in 2019, and that patient files a claim against you for that treatment in 2021, the 2021 policy will respond, because that is when the claim was reported. Now, there are some additional caveats with the claims made policy. In order for the claim to be covered, there must be coverage enforced at the time the patient was treated.

Each claims made policy will contain a retroactive date, which is the first date of coverage under the policy, and that date will be identified on all future renewal policies. As long as the claim occurred after the retroactive date and is reported while the claims made policy is enforced, coverage will trigger.

Host: So Frode, you mentioned a retroactive date. Can you explain what this term means in more detail for our listeners?

Guest: Sure Julie. A retroactive date is the first date of coverage under a claims made policy. The date will be displayed on the declarations page and will be carried forward each policy renewal. As long as the retroactive date is maintained, coverage will be available for treatment rendered on or after that date.

Host: Okay. Thanks so much for that information Frode. It's important that dental students understand the terminology that's used in these policies so they can make informed decisions. Frode, would you tell our listeners a little more about the differences between occurrence and claims made policies?

Guest: Of course I'd be happy to. Another difference between occurrence and claims made coverage is that once a claims made policy is canceled, coverage will no longer be available unless an extended reporting period is secured. This is often referred to as tail coverage. This can be purchased. But most often it's provided at no cost when a DDR event occurs.

Now, DDR is probably unfamiliar to many. DDR stands for death, disability, and retirement when it comes to insurance. The other main difference of a claims made policy is that the limits that are in place on the current policy will apply to the claim. So in our example, if the policy holder increased their limits from 2019 to 2021, even though the treatment giving rise to the claim occurred in 2019, the higher limits available on the 2021 policy will apply.

Host: Frode, I'm glad you provided an overview of those two policy types. It sounds like it can be a complicated decision.

Guest: It can be, and it's important to understand how each works, and that's why it's crucial to work with a professional who can assist you in making an informed decision.

Host: So Frode, you mentioned the need for an extended reporting period or tail coverage, when a claims made policy is canceled. Other than a death, disability, or retirement event, what causes termination of a claims made policy?

Guest: Good question. It could be a number of things. A dentist may join a new group employer who maintains coverage with another insurance carrier or may relocate to another state where other carriers are an option. The important thing to keep in mind is that tail coverage is always available when you cancel a claims made policy. Another important feature of a claims made policy is the ability to transfer the retroactive date from one carrier to another. This is referred to as obtaining prior acts coverage and is often a viable option.

Host: So it sounds like a claims made policy provides flexible coverage as dentists transition in their practices, and it's good that coverage is available in these situations.

Guest: Yes, both claims made and occurrence policies provide flexibility and a professional can help you choose the policy that best fits your individual circumstances.

Host: I think this may be a good place to pause our conversation. In our next episode, we're going to explore additional concepts related to professional liability insurance, including contract specifics, limits, and coverage. So thank you Frode for joining us for this episode and telling our Forecast listeners about the basics of malpractice insurance for dentists. It was really great having you, and I look forward to learning more about this very important topic next episode.

Guest: Thanks for having me.

Host: So as always, a thank you to our listeners. We appreciate you taking time out of your day to tune in to the Forecast podcast series.

VO: Do you wanna learn more or do you have a specific question to ask? Contact Fortress Insurance through our website at dds4dds.com. That's d-d-s, the number four dds.com.