What Insurance Do I Need for Dentists and Physicians in Connecticut?

75% of businesses in the US are underinsured, and 40% never reopen after a disaster. If you are a physician or a dentist who manages your own private practice, you already know how challenging it is to be a business owner without having recurring breakdowns. Insurance is the financial backup that your business requires. 

The challenging part is not finding a good insurance company, but deciding what type of insurance your business requires. Running your own practice means needing several types of insurance to cover every possible thing that might go wrong. 

Here are the ten most important types of insurance for dentists and physicians in Connecticut:  

10 Essential Types of Insurance for Dentists and Physicians

Choosing the best business insurance is not easy. Dentists have a lot of detailed decisions to protect their millions in investment.

 

Fire and Allied Perils Insurance

 

This type of insurance provides cover against loss and damage caused due to fires. Fire and allied perils insurance cover for the following damages: 

• Fire brought by faulty wiring
• Gas explosions 
• A fire caused by lightning and natural disasters
• Storms and floods
• Damage to the insured property
• Fire brigade charges
• Theft and burglary 
• Loss caused by business interruption 
• Bursting of water tanks, apparatus, or pipes
• Fees of architects and consulting engineers
• Extinguishing expenses 

Apart from these, it also covers: 

• Items of furniture
• All costly medical equipment

 

Business Owner’s Policy (BOP)

 

A business owner’s policy is similar to a home owner’s policy that combines all the business property and liability risks into one business insurance policy. Package policies are created for businesses that generally face the same degree of risk and are sold at a premium that is less than the total cost of the individual coverages. Typically, a basic business owner policy covers:

• Crime insurance that protects your business from theft, forgery, and scams
• Commercial property insurance that protects your building and contents owned by the company
• General liability insurance covers expenses for bodily injury or property damage resulting from what you and your employees fail to do in your operations
• Business income that covers your employees’ salaries and other bills

Businesses can tailor their business owner’s policy and ask for additional coverage that may include:

• Data breach
• Income for off-premises utility services
• Equipment breakdown
• Rented vehicles
• Employment practices liability
• Personal injury 
• Other specialized coverages

To apply for BOP, businesses must have:

• A low-risk industry
• Less than 100 employees
• A commercial space
• Annual revenue less than $5 million 

Business insurance policy covers many businesses, including auto repair shops, clinics, bookkeeping and accounting offices, and retail stores. 

 

Business Overhead Expense Disability Insurance

 

What if a medical practitioner gets injured or sick and is not able to generate income? How will they pay their employees and clear the rent? This is where business overhead expense disability insurance comes into play. It helps with:

• Paying employee salaries 
• Keeping your business running
• Paying for utilities, rent, and property taxes
• Paying accounting and legal fees
• Getting office supplies
• Taking into account depreciation 
• Janitorial services
• Maintenance
• Malpractice
• Other necessary expenses

You can apply for business overhead expense disability insurance by meeting these two conditions: 

• • If you have a clinic, you can’t hire more than 10 doctors/physicians 
  • If you have a manufacturing company, you can only employ 20 people

 

Entity Malpractice Insurance

 

It is possible that your practice could potentially be named and found liable for damages in malpractice lawsuits. While personal malpractice insurance covers claims made against you, entity malpractice insurance covers claims made against your dental practice. 

Key points of entity malpractice insurance: 

• Coverage is sold separately or may be offered as part of your professional liability insurance
• It provides coverage against any defense-related costs
• Protects certain entities when they are also named in the lawsuit, including the doctor(s)

 

Commercial General Liability Insurance

 

Commercial general liability insurance protects your business from risks including property damage, bodily harm, advertising, and personal injuries caused by your services, employees, or business operations. Here are a few examples of situations in which your business is found responsible for paying medical and non-medical costs:

• While visiting your clinic, a customer slips due to the uneven flooring 
• Someone files a lawsuit against your business alleging that your previous commercial carried misleading information 
• Your employee, while working at your client’s property, causes a steam explosion 
• A photographer suing you for using their photos in your commercial without permission 

Here are the types of commercial general liability insurance: 

• Occurrence provides coverage that takes place during the policy period, regardless of when it arises. It means that if the incident occurred within the time frame dictated by the initial policy, coverage would be provided regardless of the policy being canceled
• Claims-made provides coverage for reported claims within the specified period set and mentioned in the initial policy. In simpler words, if the premium isn’t paid, reported claims will not be covered

 

Life Insurance

 

In 2020, 54% of Americans had life insurance, with 3 in 1 families remaining uninsured. 

While life insurance is not directly related to your practice, it is another form of financial protection that every physician requires. It is a legally binding contract between an insurer and a policyholder. It guarantees that the insurer pays a sum of money to named beneficiaries if you pass away during the policy term. There are two types of life insurance, including:

• Term life insurance
• Permanent life insurance

Term life insurance is the most affordable and popular type of life insurance. Term life insurance provides coverage for a certain period of time, and when the insured person dies during the time period, a death benefit is paid to the named beneficiaries. The premium payment stays the same for the duration of the policy. 

Permanent life insurance offers a death benefit and cash value paid to your beneficiaries after your death. It provides lifelong coverage, and it’s more expensive than term life insurance because the cash value builds over time, and it can last for life.  

Here are the varieties of permanent life insurance:

• Whole life insurance: It is sometimes called straight life or ordinary life insurance that covers the insured person for life as long as premiums are paid on time. 
• Universal life insurance: It is a type of cash value life insurance that offers more flexibility than a whole life insurance policy. With UI, you can alter your premium payments and death benefit with certain limits. 
• Burial insurance: It is a type of funeral expense life insurance policy that covers funeral costs and final expenses. 
• Survivorship insurance: Also known as ‘second to die life insurance,’ it covers two policy owners, usually a married couple. No benefit is paid when the first insured dies. The survivor continues to pay the premiums. When the second insured dies, that’s when the benefit is paid to the named beneficiaries. 

 

Property Insurance

 

Even before you start seeing patients, you may have spent millions of dollars on medical supplies, furniture, and electronics. You spend millions on making your dream clinic come to life, and there comes a natural disaster that destroys everything—where will you get the money to rebuild it again? This is where property insurance comes into play! 

Property insurance is often purchased in tandem with liability insurance. Here are the perils covered by property insurance:

• Damage caused by the fire
• Impact of snow and ice
• Lighting and storm 
• Damage caused by wind and hail
• Volcanic eruption
• Damage caused by vehicles and aircrafts
• Vandalism

Here is what property insurance doesn’t cover:

• Termites and insects damage
• General wear and tear
• Rust 
• Mold 
• Damage caused by smog
• Damage caused by agricultural operations
• Sewer backups
• Damage from an earthquake 
• Seeping groundwater
• Tsunamis, floods, and drains
• Acts of terrorism 

Everyone who owns an expensive property requires property insurance. Generally, the cost of property insurance is $1,200 to $1,400 annually, but premiums vary from state to state. The average premium cost starts from $600 and goes to $2,500 annually, depending on the state you reside in. 

 

Worker’s Comp Insurance

 

Workers’ compensation insurance, formerly known as workmen’s compensation (quick fact: the name was changed to make it gender-neutral), protects employees under state laws and provides medical benefits, disability, and rehabilitation benefits for workers who get sick or injured at work. The wage and medical benefits vary by state, and the coverage premiums are based on the employer’s payroll. 

It is considered social insurance as it relies on a social relationship between the employer and the employee. The average annual premium paid by the businesses is $600 annually. However, the cost varies from state to state and the type of business it is; for example, high-risk construction businesses pay higher premiums. 

Even the safest places sometimes experience incidents that result in an employee getting sick or injured. In 2019, 5,333 employees died from a work-related injury, while in 2018, the number was 5250. 

 

Cyber Liability Insurance

 

You might be wondering what the point of physicians investing in cyber insurance is? Cyber liability insurance protects your clients in the event of a data crisis. Hacking is real, and doctors shouldn’t lull themselves into thinking that they wouldn’t be targeted. Many business owners think that cyber insurance can protect their businesses from cybercrime. However, that’s not the case at all; it can’t save businesses from hacking attacks but can help minimize business disruption during a cyber incident and cover the financial cost of dealing with the attack. Hospitals and clinics have become vulnerable to cybersecurity threats. 

Cyber insurance generally covers the cost of:

• Data restoration: Covers the cost of replacing or restoring data, software, and programs
• Loss of income and extra expenses: Covers expenses to restore operations after a shutdown caused by a computer virus or a hacker attack
• Crisis management: Covers the cost of hiring an attorney, forensic accountant, or computer expert
• Notification cost: Covers the cost of notifying people whose data has been affected by the cyber attack
• Cyber extortion: Covers a ransom paid to the hacker who threatens to leak confidential data

Cyber insurance claims can be triggered by:

• Social engineering attacks resulting in fund-transfer fraud attacks
• Email compromise scams
• Ransomware 

 

Commercial Auto Insurance

 

If you take house calls quite often, then you should consider investing in commercial auto insurance. Commercial auto insurance covers the cars, trucks, and vans used in conducting your business. Even a simple trip to your patient’s house can open you up to some vehicle risks, which makes having a financial backup necessary. 

Commercial auto insurance provides: 

• Bodily injury liability coverage: Pays for injury or death for which you are at fault.
• Collision insurance: Pays for damage to your vehicle regardless of whose fault it is.
• Comprehensive insurance: Pays for damage to your vehicle from causes other than accidents, for example, floods, theft, and earthquakes.
• Uninsured motorist coverage: Pays for your injuries and vehicle damage when you are hit by an uninsured vehicle.
• Underinsured motor coverage: Covers for you if the driver at fault doesn’t carry enough liability insurance to cover the bills.

 

Final Thoughts

After spending millions of dollars on expensive equipment, electronics, and furniture, how does not getting insurance make sense? While these types of insurance for dentists and physicians in Connecticut may not cover all the needs of medical pracitioners, they are a great place to start if you want your practice and clinic to be safe from all the what-ifs. If you think you don’t need insurance, remember that 40% of the businesses in the US don’t operate again after a disaster.