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A Dentist's Guide to Insurance Coverage

A Dentist's Guide to Insurance Coverage

November 18, 2019
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Running a business, whatever the nature, always comes with risk. Losses and damages are at times inevitable and although it may not be obvious from the start, good insurance coverage is undoubtedly, a must-have.

 

When we talk about Business and Commercial Insurance for Dental Professionals, two questions often come to mind. What things need to be insured and what types of insurance would cover those items? However, before we can even start to talk about these things, let’s try to understand why insurance is needed in the first place.

 

Practicing dental professionals, just like many other professionals, are exposed to numerous risks that come with running a business. In addition, when mistakes happen, business owners can be vulnerable to huge financial losses and emotional stress. To minimize these risks, it is important to understand which parts of the business present the biggest risks and which type of insurance addresses those risks.

What types of insurance do I need for my dental practice?

 

General Liability and Property Coverage

This coverage protects you from in the event someone slips or falls in your dental office, or if someone else’s property is lost or damaged and your dental practice is held liable.

 

Workers’ Compensation Insurance

Aside from this type of insurance being required by most states, when you run a business and you have employees, it’s always good to have coverage that allows for income replacement and benefits covering medical expenses in the event an employee gets injured in the course of their employment.

 

Business Interruption

This coverage helps you replace income lost due to unforeseen circumstances that would require you to temporarily stop operations.

 

Medical Equipment Breakdown

Your business heavily depends on your equipment--from dental vacuum systems to computer imaging systems. Should something sudden and unexpected happen to your equipment, this coverage could help to get it repaired or replaced.

Medical Malpractice Insurance

As a trusted medical professional, it is important that you carry this coverage to protect yourself from claims that you’ve made professional errors. Also known as Professional Liability or the E&O Insurance, this coverage can also cover legal expenses in the event a claim is filed, even if the claim is not valid.

Business Auto Coverage

If you have vehicles registered to the business or if you have employees who run errands for your dental office using their personal vehicles, then the Business Auto Coverage provides protection against financial losses in case of a covered vehicular accident as it pays for related expenses such as car repair costs and medical expenses.

Cyber

As more and more companies are switching to a paperless office system, the need to protect that system is also growing. Many companies rely on electronic data in order to create a convenient and efficient workflow. Perhaps one of the most important things that should be considered when building a dental office is HIPAA (Health Insurance Portability and Accountability Act) compliant. HIPAA is a US law designed to provide privacy standards to protect patients’ medical records and other health information that is provided to dentists, health plans, doctors, hospitals and other health care providers.

Since HIPAA is such a huge part of a dental practice, Cybersecurity or Cyber liability insurance should also be a priority.  Cybersecurity or Cyber liability will help protect your business if there is a data breach involving sensitive customer information, such as social security numbers, credit card numbers, account numbers, driver's license numbers, and health records. Contrary to popular belief, hackers prefer small businesses since employees are less likely to receive training in protecting patient information when there is no formal IT department. Also, most small businesses do not have a firewall in place and of course, the less protection, the greater the chance of being a target. The following chart will show how this coverage will protect your business.

 

First-Party Liability Coverages

Third-Party Liability Coverages

  • Loss or Damage to Electronic Data - It also covers the damage or theft of data stored on your computer system that belongs to someone else.

    The policy generally covers the costs to restore or recover lost data. It may also cover the cost of external experts or consultants you hire to preserve or reconstruct your data.
  • Loss of Income or Extra Expenses - Cyber policies cover income losses and extra expenses that result from an interruption of your computer system by a covered peril. Property policies cover income losses and extra expenses that result from an interruption in your business operations caused by physical damage, to covered property, which does not include electronic data.
  • Cyber Extortion Losses – This coverage applies when a hacker or a cyber-thief hacks into your computer system and threatens to commit a nefarious act. Extortion coverage typically applies to expenses you incur (with the insurer's consent) to respond to an extortion demand, as well as the money you pay the extortionist.

 

  • Notification Costs - Policies may cover the cost of informing parties affected by the data breach by government statutes or regulations.

 

  • Damage to Your Reputation - Some policies cover the costs incurred by marketing and public relations to protect your company’s credibility following a data breach. This coverage may be referred to as Crisis Management.
  • Network Security Liability – Coverage for lawsuits due to a data breach or to the inability of others under your employment, to protect data in your computer system.

 

  • Network Privacy Liability – These covers lawsuits based on allegations that you failed to properly protect sensitive data stored on your computer system. The data may belong to customers, clients and other parties. Some policies cover liability due to the release of private data (such as social security numbers) belonging to your employees.

 

  • Electronic Media Liability – This includes lawsuits against you for acts like libel, slander, defamation, and copyright infringement, invasion of privacy or domain name infringement. Generally, these acts are covered only if they result from your publication of electronic data on the Internet.

 

  • Errors and Omissions Liability - include coverage for negligent or poor work that arises out of professional services the insured provides.

 

This is only a small portion of the many coverages that are available to you. We know that this can be an overwhelming task, but Advantage Insurance Solutions is here to help walk you through the process. One of our professionals will sit down with you and discuss any gaps in coverage you may have or create a whole new policy for you if you are just starting your practice. Contact us today and our agency will take the time to research each carrier and find plans that fit your business and your budget, leaving you free to get your business up and running or to sit back and relax knowing that you are fully covered for whatever life may bring.

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