Do Veterinarians Need Malpractice Insurance?
As a veterinarian, you need several kinds of professional insurance to protect yourself and your business. However, malpractice insurance plays a vital role in helping you defend against specific allegations and potential legal challenges. Furthermore, as the veterinary industry continues to evolve, some of the situations where malpractice insurance is useful are becoming more common.
But does every veterinarian need malpractice insurance—and how much should you purchase if you do? Don’t worry; we’ve set out to help you answer these questions below. Read on and discover why malpractice insurance matters, whether you need to purchase it, and the best ways to buy it if you do.
The Role Insurance Plays in Your Business
Professional insurance can do more than keep your business alive in the aftermath of an unforeseen event. It can also help you maintain your standard of living and your family’s future.
However, the right insurance policies will serve you even before an incident has occurred. That’s because strong coverage provides peace of mind. Having contingencies for worst-case scenarios allows you to spend more time and energy providing excellent service to your clients and growing your business.
There are five main types of professional insurance that veterinarians need. I’ve already covered these in a previous article, so I’ll just include a quick list here:
- Disability insurance
- Life insurance
- Malpractice insurance
- Business personal property insurance
- General liability insurance
All of the insurance types listed above are necessary for veterinarians, but malpractice insurance is critical. That’s because malpractice insurance protects you from liability tied to acting within the scope of your professional duties.
What Is Malpractice Insurance?
In veterinary medicine, malpractice insurance sometimes goes by different names. It is often called veterinary professional liability insurance, or simply veterinary liability insurance.
Here’s the simplest way to describe what this type of insurance actually does: it helps cover your legal defense costs if one of your clients claims that a mistake you made caused them damages or financial losses. It can also help cover the cost of any damages the law requires you to pay if you lose your case.
Malpractice insurance does not cover general liability claims. Dealing with a client who claimed that they injured themselves by tripping and falling in your waiting room would require general liability insurance, whereas dealing with a claim that you accidentally neutered a client’s puppy during their routine check-up would require malpractice insurance.
In all seriousness, though, many situations can require comprehensive malpractice insurance coverage. Take the recent case of an equine veterinarian who was sued for $4 million when a prescription supplement he had ordered killed 21 polo horses. The pharmacy that produced the supplement had used an incorrect formula, but the suit claimed that the veterinarian demonstrated negligence by not double-checking the product before use. If he had lost his case, malpractice insurance would likely have been the only way to keep his business alive.
What Do Veterinarians Need From Their Malpractice Insurance?
It’s not enough to know why malpractice insurance matters. You also need to understand who at your practice holds the responsibility of purchasing malpractice insurance and how much that person needs.
Who Normally Buys Veterinary Professional Liability Insurance?
In most cases, the veterinarian who owns the practice is the one who has to buy malpractice insurance. However, that doesn’t mean you can automatically stop worrying if you’re a resident!
Every contract is different, so make sure to double-check yours before assuming that you won’t have to purchase malpractice coverage. Some contracts don’t stipulate that the owner’s malpractice insurance covers residents, so in those cases, you’ll need your own policy.
How Much Malpractice Coverage Does Your Practice Need?
If you’re a practice owner (or a resident who needs their own malpractice coverage), it’s best not to skimp on malpractice insurance. You might be a conscientious and diligent veterinarian, but accidents can still happen to the best of us. What’s more, malpractice suits have become more common and severe over the last 50 years as social attitudes towards animals have changed.
The law used to consider pets a form of property. As such, they had specific, objective value. Today, however, the law in most places views pets as special property with a subjective emotional value to their owners. Therefore, owners can often claim larger damages if an animal they love is harmed by a veterinarian’s mistake.
Protecting yourself from more potentially severe claims means you need more malpractice coverage. We typically recommend that veterinary practice owners purchase at least $1,000,000 of malpractice insurance to protect their business in the event of a malpractice suit.
What Else Do You Need In Your Veterinary Professional Liability Insurance?
Choosing the right malpractice insurance policy can be complicated, so we always recommend speaking with an experienced broker who can help you understand your options. However, there are also a few details you can look for yourself whenever you’re reviewing a policy. Make sure to consider the following:
- Who will the insurer hire to defend you from the claim? It’s best to choose an insurer that uses nationally recognized veterinary civil litigation specialists.
- Will you have a voice in your defense? If your policy has a consent to settle clause, claims against you cannot be resolved without a court order or your written authorization. Without a consent to settle clause, you may not even know you are being sued until the claim has already been resolved.
- Will you be able to refuse to agree to a settlement? Policies with a hammer clause make you responsible for your insurer’s legal costs and other judgments if you don’t agree to a settlement they’ve negotiated on your behalf. Try to avoid policies with such clauses whenever possible.
- Will your insurer call expert witnesses, and will your claims adjuster have specific experience with veterinary litigation? Talk to a broker to find insurers who specialize in such matters.
Find the Malpractice Insurance that Protects Your Business
Comprehensive malpractice insurance is a must for veterinary practice owners (and some residents as well). For guidance in choosing a policy that will protect you and your business, contact a broker who regularly works with veterinarians and can walk you through the best available options.
DISCLAIMER: The information on this website is provided with the understanding that neither the Loyall Group, nor the authors of content provided or otherwise accessed on this website are engaged in rendering actionable financial, legal, accounting, tax, medical, veterinarian, or other professional advice and services. The information and guidance provided here should not be used as a substitute for consultation with professional financial, accounting, tax, legal, medical, veterinarian, or other competent professionals. Before making any decision or taking any action, you should consult a qualified professional. A more comprehensive summary of our policies in this regard can be accessed here.