An insurance policy is a critical aspect of running a business but besides this realization, 75% of American businesses are underinsured with 40% of small businesses operating without insurance. This can hugely be attributed to the cost of starting and running a business.
However viable the excuse can be, this is a risky venture given the excessive amount that can be claimed if any incident occurs at your work premise. While having the best provider for long-term disability insurance is critical for medical practitioners, there are other 5 types of insurance that you need to protect your medical practice.
Which Types Of Insurance Do You Need To Protect Your Medical Practice?
While understanding how to protect your business from fraud is vital in running a business, without this insurance covers your risk closure.
1. Medical Malpractice Insurance
The number of medical practices that got sued because of malpractice continues to rise each year with obstetrician-gynecologists topping at 85%. If the largest ever medical malpractice claim is anything to go by then your business may be crippled.
Additionally, over half of US doctors have faced medical malpractice lawsuits, that is 1 in 3 physicians being sued. The odds are stacked against medical practitioners so having medical malpractice insurance is vital.
You should expect to spend around $7,500 annually as the average cost of medical malpractice insurance.
2. Workers Compensation Insurance
Nursing and residential care facilities top the charts with the highest industry rate of injuries with strains and sprains termed as the common injuries among nurses and healthcare professionals– overexertion accounts for 46% of all nursing injuries.
Subsequently, the most common work-related injuries ricochet between falls, trips, and slips. The highest workers’ compensation settlement to attune of $10 million with strains topping with 30.06% of workers compensation claims.
Given the average worker’s compensation insurance cost of $78 per month, a worker’s compensation insurance will come in handy in case of any eventualities
3. Practice Overhead Insurance
Physicians are likely to experience some form of disability before retiring and given that the average overhead cost of medical practice is estimated to be between 60-70%. Having to take leave due to disability will create a financial crunch if not mitigated.
The price of a practice overhead insurance varies from $30 to $5,000 in units of $100 or $1000 depending on your age, business duration, and revenue verification. The benefits of this insurance cater to debts, insurance premiums, office expenses, real estate, dues, and fees. However, you or relatives employed within 60 days will not enjoy the benefits of this cover.
4. Property Insurance
While only a meager number of 5.1% of homeowners made a claim, 97.2% of those claims were due to theft in 2019. But in a five-year period between 2015-2019 wind and hail topped the charts with 2.5%, followed by water damage and freezing at 1.9% and fire and lighting with less than 1%.
Divided into two; property insurance offers policyholders the opportunity to opt for Open perils or Named perils. Open perils offer property cover excluding damages from floods, earthquakes, terrorism, and nuclear. While Named perils are specific to the cause of damage like fire, lightning, theft, and explosion.
5. Business Interruption Insurance
Though business interruption may form a package with property insurance to be known as a business owner’s policy, business interruption insurance covers the profit margin of the business different from property insurance that deals with the physical damages.
It’s also termed business income insurance able to facilitate the business running as the business gains momentum after an interruption period. The expected average cost for a business interruption insurance plan varies depending on the value of the business but on average it ranges between $40-$130 monthly.
While it may not be certain to estimate the exact cost of lawsuits given the complexity of a case, the average amount you’ll be expected to pay for a simple lawsuit is around $10,000. As a growing medical practice, you’ll need every penny to either expand or buy the latest equipment for your practice.
So these 5 types of insurance will protect your medical practice and ensure that you thrive and put your mind at ease concentrating on your expertise.
I am a CFP® (Certified Financial Planner).
I have a severe phobia of bridges and dirty balance sheets.
Hobbies: blogging, meditation, and loving Bull Market (my dog).