Why Is Psychologist Malpractice Insurance Important For Your Career?

Why Is Psychologist Malpractice Insurance Important For Your Career?

While looking after your patients, you are at a greater risk of liability claim. Thus, you need an effective coverage plan to defend yourself against frivolous lawsuits. Typically, a single malpractice lawsuit against therapists or psychologists could be around $50,000 and may take years to prove your virtue. Even after that, you may not be able to recover the incurred financial losses.

With psychologist malpractice insurance, you can protect yourself against any liability claims or malpractice lawsuits. However, you will require a specialist independent agent whose expertise lies in this particular domain to ensure the risks are covered.

Approximately 30% of adults and 19% children seek medical assistance of a psychologist or other behaviorists. Commonly, they get referrals for:

  • Depression
  • Anxiety
  • Grief or sadness
  • Substance abuse
  • Chronic illness

How Does Psychologist Malpractice Insurance Protect You Against Liability Claims?

Like any other medical doctor, attorney or architect, the services of mental health professionals can cause financial loss or personal injury. However, each requires a customized liability plan tailored as per the risks of the profession. As a psychologist, you may even face a lawsuit from a client who suffered from multiple injuries due to a suicide attempt as you failed to provide adequate treatment.

While as a professional, you try to make the best judgments but as a human being, you are prone to errors and mistakes. A single lawsuit claim can derail your career and put your years of struggle down the drain. Buying malpractice insurance protects you and your assets from lawsuits.

Types of Psychologist Malpractice Insurance

When purchasing your counselor malpractice insurance, you have two options:

  • Claims-made: It covers the lawsuit claims only if the policy is active
  • Occurrence Policy: It covers the events that took place when the policy was effective, even if it has expired now.

To provide protection against lawsuits, claims-made policies need regular renewal, while occurrence will provide coverage even if you no longer have the policy.

Add-Ons for Claims-Made Policies

Claims-made policies provide protection from events happened during the retroactive to the expiration date. The policy does not cover any claims before or after those dates, unless you buy add-ons or endorsements. The most popular is a tail coverage, which provides you protection against the events within the policy’s validity, but for claims made after expiration.

What Does Psychologist Malpractice Insurance Provide Coverage for?

You can either get an individual or group policies offering a number of benefits listed below:

  1. Legal Fee and Court Costs: You get financial coverage for the expenses caused due to the lawsuit claim until the settlement. Some insurance policies even provide replacement pay for the days you attended court.
  2. Legal Defense Costs: The insurance pays the fee to present in front of the legal board.
  3. Coverage of Professional Services: It also covers the membership losses you suffered due to the lawsuit.
  4. Sexual Transgression: It pays for the defense cost against the accusations related to sexual misconducts.
  5. Damage Repute: It covers various caused due to libel, slander, copyright issues and defamation
  6. Personal Injury: It protects you from the injuries caused due to slander, false arrest and privacy issues
  7. Liability of Premises: It covers for the losses incurred in your practice area; clinic or hospital.

If you are looking for a profession-based insurance policy, then check out our website to find a wide array of psychologist malpractice insurance policies.

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