Covering Your (Professional) Assets

Know Your Limits
Whether or not you opt for your own policy, know what coverage you do have. If you’re covered through your employer, make sure you have (at the very least) a copy of the declarations page, which will provide the name of the insurance company, the policy number, and the terms of coverage. McCammon suggests making it a condition of your employment that your employer will provide this information every year.

“People need to know their limits and know that they are individually named under those limits,” Rathfon says. “And they need to feel confident that there’s enough coverage, whatever the policy is, whether it’s their own or through their employer.”

Familiarize yourself with the type of policy you have: Is it occurrence-based or claims-made coverage? The former applies to any incident that occurs during the period of coverage, even if the claim is made years later. The latter covers claims filed during the life of the policy; people with this type of policy often purchase tail coverage to close any gaps that may occur. McCammon, who has authored a series of articles on liability insurance that can be found in the “Advocacy and Practice Resources” section on the AAPA Web site (www.aapa.org), says one type is not better than the other.

Occurrence-based coverage may be easier to manage; you file a copy for your records and hope you never need it. As Crosby says, “You can be retired and lying on the beach in Florida, and if there’s a lawsuit over something that happened in your last year of work, you would be covered.”

However, the economic downturn has highlighted one drawback to occurrence-based coverage: The company that covered you 10 or 20 years ago may not be in business by the time you have a claim. “Ten or 20 years ago, that was not a real issue,” McCammon says, “because companies just didn’t go under. But in this day and age, companies are getting out of the business or going out of business.”

That doesn’t mean you should avoid occurrence-based policies. But you might do a little extra homework on a company’s financial stability and longevity.

Rates depend on a number of factors, including geographic location and specialty of practice. AANP members can find information at www.proliability.com. AAPA members can contact AAPA Insurance Services at (877) 356-2272.