By Vanessa Orr
To stay healthy, it’s important to get an annual physical. In the business world, it’s just as important to do an annual review of liability coverage to make sure that your company or practice is managing risk should an unexpected or potentially costly event occur.
“Businesses change over time—for example, a physician practice might hire new doctors or invest in new equipment—so it’s vital to make sure that the company has the right types of coverage in the correct amounts,” explained Bill Gompers, CFE, healthcare providers’ insurance specialist at Danna-Gracey. “While you can’t completely avoid risk, the question is how much you want to take on yourself and how much you want to share with the insurance company.
“A lot of practices and companies think that they have the right coverage, but find out that they don’t have what they need when they need it,” he added. “It’s like when a hurricane strikes; a homeowner may think that their screen enclosure is covered, but find out after it’s damaged that they didn’t have the proper rider on their policy.”
He adds that when purchasing liability policies, buyers can be misled or not understand what the policies cover as carriers’ policy forms are not uniform and have exclusions that allow them to offer lower rates.
Healthcare providers can choose from a number of liability coverages, including professional liability insurance (medical malpractice); workers’ compensation insurance; regulatory liability insurance; employment practices liability insurance (EPLI); commercial general liability insurance; cyber liability insurance and employee benefits liability insurance.
“One of the most important liability coverages—that many practices don’t know they need—is employment practices liability insurance,” said Gompers. “You are at risk every time you discipline someone, fire them, or accept their resignation; companies can also be sued for sexual harassment and discrimination.”
EPLI protects businesses against the high costs of lawsuits due to discrimination, harassment, wrongful termination and other potential charges stemming from employment practices, and can cover the costs of legal defense, settlements and other court fees.
With cybercrime on the rise, it is also important to carry cyber liability insurance. According to Keeper Security, nearly two-thirds of healthcare organizations globally have experienced cyberattacks in their lifetimes, while 53 percent have been attacked within the last 12 months
“It can cost a minimum of $20,000 to $30,000 to clean up a cyberattack,” said Gompers. “If you suffer a big hit and have a lot of information stolen, it can cost hundreds of thousands of dollars.”
Even general liability insurance policies need to be reviewed as it is important to know the responsible party in case of an accident. “If someone slips and falls in the waiting area or falls off an exam table, who is responsible?” asked Gompers. “While a lot of doctors think that their landlords’ policies cover this, they may not, and it can get very expensive if someone suffers a serious injury.”
Gompers also advises clients to look into regulatory liability insurance and employment practices liability insurance as companies can lose money as a result of everything from claims based on allegations of billing errors, to shadow-auditing expenses, to being sued for not enrolling an employee in a benefits program.
“If the government comes in to audit you, you need to have someone representing you,” he said of the insurance that covers legal expenses as well as provides reimbursements for regulatory fines and penalties. “Any of these issues can slow or stop the flow of money into a practice.”
Working with agencies that are healthcare providers’ insurance specialists can not only reduce risk, but ensure peace of mind and provide you and your organization with value-added services.
“Don’t just work with an order-taker—work with professionals who understand your business and can give you prudent advice,” said Gompers. “Things change, and it’s important to know that your assets are protected.
“I have people say, ‘I haven’t had this coverage in 10 years and I’m saving money on premiums because there haven’t been any claims,’” he added. “That’s like saying that you have life insurance and you don’t need it because you haven’t collected on it. You need it when you need it.”
To schedule your company’s annual review, contact Bill Gompers at bill@dannagracey.com, (888) 777-7173 or visit www.dannagracey.com.
