Professional Liability Coverage for Dental Professionals

Jun 16, 2021 | Business Insurance

Dental Malpractice

Malpractice insurance for dentists may be required unless other kinds of optional insurance policies. This means that you may need this insurance coverage in order to become a licensed practicing dentist.

Your choice regarding malpractice insurance is not whether you opt to get a policy depending on where you practice. Instead, it’s opting for which provider and kind of coverage you need to safeguard yourself from possible legal action against you.

We greatly suggest checking different factors that matter when choosing an insurance provider and other important information about malpractice insurance.

What is malpractice?

According to Merriam-Webster, malpractice is defined as “a dereliction of professional duty or failure to exercise an ordinary degree of professional skill or learning by one rendering professional services which result in injury, loss, or damage.” In easier terms, dental malpractice is a kind of deviation from the basics of care that leads to patient injury and even death due to negligent treatment or failure to diagnose and or treat. The patient may be able to sue for damages through the civil litigation process to compensate for his or her harm if it can be proven that a certain dentist acted negligently to cause a patient such injury.

What is dental malpractice insurance?

Dental malpractice insurance is also known as professional liability or errors and omission insurance. Malpractice insurance protects licensed healthcare professionals from possible allegations against their negligence during their performance of their professional duties.

This is basically protection against a malpractice claim. If one of your clients files a lawsuit alleging that you didn’t perform your responsibilities well and were being negligent of your job, this insurance may help you cover the fees to protect yourself in a legal court along with other policy-outlined provisions.

In most cases, oral surgeons have a high chance to have claims filed against them in the dental profession since they tend to perform more complicated procedures and they also frequently use anesthesia.

However, at the same time, orthodontists and general practitioners are also at high risk for claims. Dental malpractice insurance is a kind of professional liability insurance that safeguards most professionals in the dental industry.

Kinds of dental malpractice insurance

There are two kinds of dental malpractice insurance. These are the occurrence policies and claims-made policies.

Occurrence policies

These policies provide coverage for any kind of claims filed against you for work done while the policy is still taking place. You can still expect full coverage according to the terms of your policy at the time the work is done if a claim is filed after your policy is expired.

Claims-made policies

This kind of dental malpractice insurance is less expensive than an occurrence policy. However, this coverage is based on the time the claim is made against you. These insurance policies usually have a retroactive date of one to five years. You have a one-year claims-made policy if a patient files a lawsuit two years after you execute a procedure so you will not be covered. Furthermore, this is different from occurrence policies. Claims-made policies will stop providing coverage once the policy is already terminated. If you wish to be safeguarded from lawsuits after you already retire from dental practice or after you end your policy, you may opt for an additional policy called tail-coverage.

Dental malpractice coverage will give you coverage for any dental malpractice judgments or settlements. This will also cover any related court expenses and other legal fees. In most cases too, your dental malpractice insurance companies will also provide you with lawyers.

Furthermore, this insurance coverage will also cover any expenses of necessary legal fees and consultations if you are subpoenaed to appear as a witness or dental expert in a court case.

This may occur if a past or a current patient of yours sues another dentist for malpractice or if the other side of the legal court wishes to implement the proper protocol in certain dental clauses.

What is entity malpractice coverage and how does it differ?

Entity malpractice coverage has similarities with basic malpractice insurance. However, this coverage includes your business entity. You need an entity policy to cover the fees associated with a portion of the claim to make sure that you are indeed safeguarded once someone accuses you of malpractice.

This is essential coverage since you are not personally responsible for wrongdoing in a malpractice lawsuit. However, your practice can still be held also responsible for damages. You can choose entity coverage as a portion of your professional liability insurance policy or you can also purchase separate coverage to protect your work.

Do dentists need professional liability?

Dental malpractice can be both real or recognized. Out of the 5,588 dental malpractice claims reported to CNA over a 5-study time frame, about 35% were perceived to have no payment to the plaintiff. It was found out that the case was either successfully defended at trial, the client dropped the complaint or the court dismissed the case before the trial.

It can reach an average of $10,137 to defend even though there are no plaintiff payments in such cases. This is an essential part of professional liability insurance. You have to pay unlimited legal expenses such as attorney’s fees and court expenses too in addition to court settlements and judgments.

Additional data from CNA’s 5-year study:

●     The average dental malpractice claim which includes payment and legal defense can cost up to $107,915

●     20% of dental malpractice claims resulted in a payment of between $10,000 and $1 million

●     Oral surgeons have the highest malpractice claim severity with an average expense of $249,689

●     The most usual procedures that result in malpractice allegations are:

○     Extractions (22%)

○     Root canal therapy (19%)

○     Implants (11%)

○     Crowns (11%)

A lot of dentists who have not been involved in a lawsuit may think that a lawsuit won’t happen to them since only bad dentists get sued. Unfortunately, about 8,500 of your future workmates are named as defendants in malpractice lawsuits. The likelihood of being involved in a lawsuit can increase or decrease depending on your practice location, the kind of practice, and the procedures you perform. This averages to at most one claim in a typical dentist’s career.

The National Practitioner Data Bank or the NPDB said that the average dental malpractice payout is about $68,000. This is limited to the actual payment of indemnity to the person initiating the lawsuit. This does not include defense expenses which can be larger than that same amount when defending a claim in a malpractice trial.

A lawsuit is not really the tool that measures effective or non-effective dentistry. However, the end result of a malpractice claim can be traumatic, time-consuming, and expensive. This is regardless of the final verdict.

Are dentist licensing complaints covered?

Professional liability has a number of essential coverage extensions including license protection. If you lose your license, you will lose your ability to practice. Something you posted on social media can also lead to a license complaint with your state board so we suggest being very careful.

●     Complaints can be filed by anyone against you. It could be a patient, family member, colleague, employer, or staff member.

●     29% of the professional liability claims in CNA’s 5-year study resulted from license complaints

●     23% of license complaints are a result of allegations of ‘general dissatisfaction’

●     $4,435 is the average expense to hire an attorney to defend a license complaint

You will receive the same license protection limits that a professional liability has. This will allow you to get an attorney to help you respond to the allegation against you. Having an attorney with you to a board hearing will lead to a more successful outcome rather than appearing alone.

Types of Covered Risks in Dentistry/incidents with Dental Patients

Professional liability will cover you in all of the following hypothetical scenarios if:

●     A patient files suit claiming you failed to diagnose oral cancer after a routine cleaning.

●     Your state dental board investigates a claim of false advertising against you.

●     A patient claims you sexually harassed them.

●     A neighbor asks for advice then later files suit against you and claiming your advice resulted in an injury.

●     A patient complains to your state board that you breached their HIPAA privacy rights.

●     You dismiss a problem patient and they file suit claiming abandonment.

Occurrence or claims made?

What is the difference between an occurrence and a claims-made policy?

We have two different kinds of professional liability coverage forms. These are occurrences and claims made. These two determine when malpractice claims are covered and not covered.

Occurrence Policy

Occurrence policies offer insurance coverage for claims that happen while your insurance policy is still active. If the incident occurred while the policy was still active, the coverage is still available even though the policy has already expired or had already been canceled.

Claims-Made Policy

Claims-made policies offer coverage for claims that happen and are reported while the policy is in place. The coverage expires once the policy also expires. It is possible to opt for an extended reporting period endorsement or tail coverage when a claims-made policy is canceled. This tail coverage lengthens the time alleged incidents may be reported.

You may ask yourself why would anyone opt for this one considering that the claims-made policy is complicated. The answer is simple. It is the price.

Premiums are lower during the earlier years of a claims-made policy. The claims-made rate will slowly increase and will become comparable to the occurrence policy rate.

Tail Coverage

Since claims-made coverage is triggered once a claim is filed, these insurance policies will not cover claims after the termination or cancellation of the policy. You will have to get an extended reporting endorsement or tail coverage to extend coverage after termination or cancellation of a claims-made policy or else, your new insurance company must cover your prior acts. Many dentists who purchase claims-made coverage think that they will someday qualify for free tail coverage. However, this is different. Each year more than 50% of tail coverage that is issued by some insurance companies is not free but also purchased.

Common circumstances that require you to purchase a tail coverage
Board Coverage

It is likely that you will have the coverage offered to you at no expense at all for your board exam as you prepare for it. If this insurance policy is not an occurrence policy, you will need to have tail coverage after the termination of your board exam coverage in order to cover any exposures during your board exam.

Externships & Moonlighting

Always remember that the kind of coverage you will get matters when entering these great learning opportunities. After you have completed your externship or stopped moonlighting, you have to pay for your tail coverage if you have opted for a claims-made policy during this time.

Residency

You will likely be covered by the university if you decide to return to school for a residency program. If this happens, you could cancel any coverage you have for your current practice. However, you will have to purchase tail coverage to cover any years spent in practice if you are insured under a claims-made policy.

Leave of Absence

If you’re about to take a leave of absence from your practice, we suggest terminating your coverage. It may require obtaining tail coverage if you are insured under a claims-made policy. Examples of leave of absence may include maternity leave, poor health, a religious-related concern, and medical mission trips.

Which policy is right for you?

The coverage taken by both policy forms is similar. The only difference is when you can report a claim. The occurrence form is more flexible while the claims-made policy has a premium discount upfront which can be essential when just starting your dental practice.

How can I reduce my dentist malpractice insurance premium?

The following qualify for money-saving discounts:

●     AGD members, fellows, masters

●     Dental school graduates

●     ADA membership

●     Part-time dentists

●     Group practice

●     Loss control procedures

●     Operational controls

●     Claim-free credits

●     Disability or leave of absence

●     Waiver of consent to settle

Why is malpractice insurance so important?

It Could Be Required to Get Licensed

Having malpractice insurance is a needed requirement before you can become a licensed dentist.

It Protects Your Dental Career’s Future

Of course, you hope that you will never have to use your malpractice insurance but having it there can safeguard you against high fees and claim expenses associated with a malpractice lawsuit. It will also provide you with a legal professional to fight on your behalf against invalid claims against you.

Malpractice suits are likely more common than you imagine

It actually surprises many people that malpractice suits are really common. According to Sara Charles, an MD Physician with the Litigation Stress Resource Center, there were 16,337 instances of medical malpractice payments between 2006 – 2017 out of the 19,755 working dentists meaning that there is a high chance of you facing a malpractice lawsuit. Malpractice insurance is essential protection for you.

Litigation stress increasingly impacts dental professionals

Litigation stress is a negative emotion and physical reaction that comes when you are accused of a lawsuit or are brought on by the fear of continuous lawsuits being filed. Out of all the defendants, about 95% said that they had some measurable physical or emotional reaction when a lawsuit was filed against them. Litigating stress can bring a negative effect when you have to cope with normal events, communicate with others and it also stops you to concentrate well. This can negatively impact your ability to properly do your job.

Acquiring malpractice insurance as a form of protection may help calm these fears. This may help alleviate some of the stress and fear of dealing with someone from trying to sue you for malpractice or ensure they won’t accuse you of any wrongdoing. Having someone on your side can make all the difference in keeping litigation stress away from you.

What is and isn’t covered under malpractice insurance?

Your individual plan will be based on your specific needs and might differ depending on what is and what is not covered. However, the following elements of a malpractice suit may be covered at least in some kind of form by your malpractice insurance:

●     Damages should you be found liable for malpractice

●     Expenses associated with either settling or defending malpractice suits

●     Settlement costs

●     Arbitration costs

●     Medical damages

●     Compensatory and punitive damages

The following are considered not covered under your malpractice insurance policy:

●     Inappropriate alteration of medical records

●     A criminal act of some sort

●     Sexual misconduct

Digging Deeper into Malpractice Insurance Coverage Specifics

Of course, it is not the time to ask about malpractice insurance coverage in the middle of a lawsuit. By this point in time, there shouldn’t be any alterations to your insurance policy and you are stuck with the coverage amounts and limits you currently have. Instead, you should have considered setting up your policy before the issue took place or after the incident through your policy review.

This is essential since you can review whether your insurance policy fits your current dental practice needs and is not based on different factors that could be hugely different at the current time. It’s also a good idea to evaluate from time to time your insurance company to decide whether you are insured by a company that you consider is right for your needs.

Kindly understand that you can be held personally responsible for judgments that come in above your policy limits. This further proves the importance of understanding your insurance policy well and setting your coverage limits wisely. Please don’t fret even though this is a scary proposition. Instead, we suggest reviewing your coverage limits and make sure that they are high enough to properly protect you and your dental practice.

Malpractice insurance standard provisions

Dental malpractice insurance can be confusing to some. However, please keep in mind that there are some standard provisions within most policies that are less complicated. You may want to check those standards before purchasing a new malpractice insurance policy or when you review your current policy.

Consent to Settle

You should, of course, have to know who determines if a claim should then be settled. Do you have to decide? Is it up to the carrier? How much control do you have in regards to settling? The consent to settle a provision is essential to decide before you face an actual claim. Of more details regarding this since some policies don’t give you the final word in a certain settlement.

What about Sedation Surcharges?

Some professional liability policies demand updates regarding the kinds of procedures you will use among other elements such as your practice location. This could mean you have to pay a surcharge for using certain kinds of dental sedation during your procedures. Some kinds of sedation are not included in your coverage. So, it is important to ask your agent about the specific standard provisions for any new malpractice plan.

Claims-Made Versus Occurrence Coverage

You also need to check if you want a claims-made policy or an occurrence policy as these are the two main kinds of coverage available. Claims-made is a kind of coverage when a claim is made during a pre-decided coverage period. For occurrence coverage, this differs if the actions giving rise to the claim happened during your coverage period even though the claim is made after your policy term.

Occurrence coverage form

The occurrence coverage form includes many benefits.

●     Unlimited time period to report claims – This is the occurrence policy that will pay for a covered professional incident that transpired during your insurance policy period. This is regardless of whether your claim is reported. To compare, a claims-made insurance policy will only cover claims reported during your policy period.

●     Cost savings – You are not required to purchase Extended Report Period (ERP) coverage. The fees for this ERP coverage are usually negotiated when a claims-made policy is already terminating. In addition, this coverage is an essential and expensive coverage option on a claims-made form. In some situations, changing carriers or retiring from your practice, you only have a minimal choice but to opt for ERP coverage to avoid coverage gaps.

●     Flexibility – Going from one occurrence policy to another is easy to do if you decide to change insurance companies. There are no hidden ERP premiums for you to pay and a prior acts or tail endorsement is also not needed.

●     Possibility of higher limits – You may have higher limits to get with occurrence policies. This is depending on when a claim transpires and when it is reported.

●     Continuity of coverage terms and conditions – A claims-made policy is a yearlong contract that may change from year to year, also altering, reducing, or deleting essential coverage terms and conditions. These changes become retroactive at the very start of your claims-made policy. This can potentially reduce your coverage. With the help of an occurrence policy, the coverage terms and conditions can retroactively change that can offer you peace of mind about the insurance coverage you have as of now.

Awards in Dental Malpractice Lawsuits Can Be Quite Large

●     A lady was given $350,000 after a root canal resulted to nerve damage sometime in June 2013.

●     A man received an $800,000 settlement after his own dentist did not refer him to a follow-check up for a possible cancerous tumor under his tongue in June 2013.

●     A patient was awarded $2.69 million after suffering nerve damage when a dental drill bit broke during his wisdom tooth extraction in May 2013.

●     A patient received $297,000 after suffering bite problems after doing placement of a crown dental process in November 2012.

●     A man received a $200,000 award since his dentures never fit properly in April 2012.

What are some risks faced by dentists?

There are a lot of different reasons why a dentist may be sued for malpractice. Some of the following are common reasons for professional liability lawsuits:

●     No informed consent from the patient or the patient’s legal guardian

●     Non-referral of a patient to a specialist

●   Inability to properly perform prosthodontics work such as fitting crowns and bridges

●     Removing the wrong tooth or not doing a tooth extraction properly or appropriately

●     Missed to diagnose or even treat TMJ dysfunction, periodontal disease, or oral tumors and cancers

●     Accidents such as slip and falls, burns, cuts, or other injuries suffered by patients while inside your dental clinic

●     Compilations leading from the use of anesthesia during a dental operation

Other ordinary problems include adverse drug reactions, poor orthodontic work, and drill injuries. Awards can be a bit substantial depending on the extent of the injuries and problems encountered by your patients.

What happens if a malpractice suit is filed against you?

●     Your dental patient must show three evident things before a lawsuit can be filed against you. A patient and doctor relationship should have already been made and that you had the duty to treat their dental request.

●     Your patient must prove that you stayed away from your standard of care. This may include any treatment that is done in a manner outside your scope of what a wise dental practitioner would do in the same situation.

●     Your patient must also prove that there were indeed damaged because of your negligence. One great example is when your patient must have received the wrong medication accidentally. However, the patient did not have any health issues due to it. There will be no damages for this and the case would be stopped.

Your malpractice case will enter the discovery phase once the lawsuit is filed against you. You will have lawyers assigned to you by your insurance company and the attorneys representing the other party will take depositions from both parties and also from expert witnesses.

It is very important that you keep well-organized patient notes so you can give this to the prosecution. You could run into more legal issues if you don’t have patient notes or your records have been altered.

The lawyers will either agree to drop the lawsuit or will discuss a settlement once the discovery phase is complete in most cases. Apparently, only a few cases go to a juried trial.

Your Next Step:

Planning for the unpredictable

Having malpractice insurance is the very first step. You should also be careful in choosing which insurance company you should work with. Choosing a malpractice insurance policy that is backed by a long-standing company may be essential. This could show a history of understanding malpractice cases and can also offer you protection when a malpractice suit is filed against you. Your malpractice coverage should be strong as the company providing said coverage.

You should, of course, consider planning for the unpredictable now even though you never plan to face a lawsuit and hope you never find yourself in such a difficult situation. We suggest preparing beforehand and immediately acquire malpractice insurance or alter your current policy for more complete protection and don’t wait until you are already facing a full legal attack.

Ask us any questions

Thank you for taking the time to read our articles. We hope our written articles about insurance help you. Should you need any more help, please do not hesitate to contact us immediately. We will be waiting.