Market for Medical Malpractice Tail Insurance

As we approach the mid year mark in 2014 physician hiring does not seem to be slowing down. Although many reports show that bringing physicians in house is not as profitable as health system hopes they continue to do it. In many ways physicians have significantly more options then when the consolidation spree started three or four years ago.

Doctors and surgeons are faced with one of the following scenarios:

  1. Their new employer picks up their prior acts, saving them tens of thousands of dollars they would have spent on a tail. This option is often only available is moving in state and to a smaller employer that does not have a large self insured retention. Many hospital systems have multi-million dollar deductibles and do not want to risk their system’s balance sheet by bringing on risk from outside the facility.
  2. They purchase tail insurance:
  • Many traditional carriers are beginning to offer payment plans. After losing millions to lower priced competitors they have tried to find ways to compete, by allowing physicians to pay over the course of a year or two they have found a way to hold on to customers at a higher price than other carriers who require payment in full are charging.
  • They purchase stand alone tail insurance from a third party carrier. OneBeacon, Ironshore, CNA, Hallmark and Berkley are all highly rated insurance carriers offering stand alone tail insurance through specialist┬ábrokers.
  • Some desperate individuals are buying insurance from one of the dozen unrated Risk Retention Groups (RRGs) offering the coverage. These folks risk future assessments by the carriers, potentially unpaid claims and issues in credentialing when future employers discover a gap in coverage (or a potential gap in coverage due to the unstable nature of the companies).

The best thing one can do to prepare for the tail decision is to plan early. Tail prices from standard carriers are filed and can potentially be negotiated years before a decision must be made on leaving private practice and purchasing tail. The costs of staying independent are growing every day, most are shocked when the tail bill comes as a final slight from the insurance market.

Explore tail insurance options at today, the expert brokers are standing by to help.