From time to time, it may become necessary for a physician to take a leave of absence from their medical practice. It could be due to an illness, maternity leave, military leave, going back for additional training, or simply taking an extended vacation. Regardless of the reason why, it’s important for you to plan ahead and make the necessary arrangements with your practice for your time away. So what should you do with your malpractice insurance while you’re gone? There are ways to accommodate your time away while still ensuring that you are protected.
Most malpractice insurance carriers have options for you to suspend coverage temporarily when you will be gone due to health concerns, maternity leave, military leave, etc. Suspensions are usually offered when the anticipated leave is greater than three months but less than one year. Leave of absence requests do have to be approved by the insurance carrier, so make sure that you plan ahead and request the suspension well in advance of your departure (as much as possible). If you plan on being gone for longer than a year, the insurance carrier will likely not grant you a suspension and you will have to consider other options.
If you will be gone from practice for more than a year, or if your return date is unknown, it may be better for you to simply cancel your coverage and re-apply later. If you have an Occurrence policy, this is easy to accomplish, since there is no concern with tail coverage. If you have a Claims-Made policy, however, you will need to work with your agent to discuss the possible options for securing tail insurance before you leave. Tail insurance costs range from 1-2 times an annual premium, depending on how long you’ve carried the coverage. For more information on Claims-Made versus Occurrence, read our in-depth blog article HERE. Or for more information on tail insurance, read THIS blog.
If you will be gone for a shorter period of time, you can have a qualified physician fill-in for you while you are away. A locum tenens physician is a “placeholder” or one who temporarily works in place of the regular physician when they are absent. Often, a physician’s medical malpractice insurance policy affords them a set number of free locum coverage days per year. This means that a locums physician can be endorsed onto their policy at no charge, and that locums provider would be covered in the event that a claim occurred resulting from services rendered while they were working for the insured physician. Most insurance companies will require underwriting approval before they allow a locums physician to be endorsed onto the policy, so plan ahead and make sure your locums physician is approved and coverage is in place before you leave.
If suspension, locum tenens, or cancellation are not ideal solutions for you, you can keep your malpractice insurance policy active while you are away, but drop coverage down to minimal hours to reduce the cost. This option will require carrier approval, but it is a way to maintain ongoing coverage at a more affordable rate. Some providers like this option because it also allows them to return to work on occasion, whereas a suspension or cancellation does not. It does, however, mean that you will continue paying a premium - as opposed to a suspension or cancellation, which stops the premium payments.
There are many options for providers to consider when they are preparing for a leave of absence from their medical practice. If you are a physician, talk to your malpractice insurance agent well in advance of requesting the leave of absence (as much as possible) so that you know what your options are and can plan accordingly. If you are a practice administrator, talk to your agent to understand how each leave of absence request is handled so that your employee handbook aligns with the requirements and rules of your specific malpractice insurance carrier.