October 31, 2019


Question:

Jennifer, 

How do I know whether I have enough insurance? 

Thanks, 
Dr. S

Answer:
 
A few answers - 

1. Industry standard - carry what everyone else generally has, not less, and not more.  Not less, because if you have an exposure, you do not want a court to adjudicate you should have had more based on market conditions and therefore the court has no issue awarding over your limits.  Not more, because maybe there is absolutely no need for the extra premium.  

2.  Carry the legal limit.  At a minimum in most states for malpractice you are required to carry a minimum.  If you do not abide by such a requirement and you are sued there will be no sympathy for your cause and potential out of pocket exposure.  

3.  Internal compass.  Do you feel you carry enough insurance?  Based on your risk appetite and after considering 1 (mostly) and 2, above, do you feel you are carrying enough?

Whichever type of insurance prompting the question, the goal is, of course, for you to never have a claim that is going to test these limits, however, if that were to happen - a malpractice case, an unemployment claim, patient or worker slip and fall (general liability / works comp), it may not be worth chintzing on coverage.