Malpractice Insurance

AAA

DEFINITION of 'Malpractice Insurance'

A type of professional liability insurance purchased by health care professionals (and sometimes by other types of professionals, such as lawyers). This insurance coverage protects health care providers against patients who sue them under the claim that they were harmed by the physician's negligent or intentionally harmful treatment decisions.

INVESTOPEDIA EXPLAINS 'Malpractice Insurance'

Premiums are usually based on the physician's specialty and geographic location but not on claims experience. This means that even if a physician has never been sued, he or she can end up paying extremely high premiums. The premiums can become high because of factors such as amount of coverage needed, claims severity, claims frequency, location of practice and laws in the area.

RELATED TERMS
  1. Professional Liability Insurance

    Insurance that protects professionals such as accountants, lawyers ...
  2. Business Liability Insurance

    Insurance that protects a company and/or business owner in the ...
  3. Multiline Insurance

    An insurance instrument used to bundle the risk exposures of ...
  4. Liability

    A company's legal debts or obligations that arise during the ...
  5. Insurance

    A contract (policy) in which an individual or entity receives ...
  6. Liability Insurance

    Any type of insurance policy that protects an individual or business ...
RELATED FAQS
  1. What are the major categories of financial institutions and what are their primary ...

    In today's financial services marketplace, a financial institution exists to provide a wide variety of deposit, lending and ... Read Full Answer >>
  2. How can I invest in a mutually owned insurance company?

    Mutually owned insurance companies do not issue stock or other equity securities. This means you cannot become a shareholder, ... Read Full Answer >>
  3. How are contingent beneficiaries informed of a payout?

    One of the greatest tools in estate planning is beneficiary designation. Listing primary and contingent beneficiaries is ... Read Full Answer >>
  4. What are the most popular mutual funds that invest primarily in the insurance sector?

    Under the purview of the financial services industry, the insurance sector is an attractive investment option for mutual ... Read Full Answer >>
  5. What are some examples of how corporations manage short-term investments?

    One of the easiest ways for a business owner to reduce liability is to incorporate as a legal entity to enjoy the protection ... Read Full Answer >>
  6. What are some examples of industries that practice price discrimination?

    Individuals can transfer the risk of financial loss from a wide variety of sources to a third party through the purchase ... Read Full Answer >>
Related Articles
  1. Entrepreneurship

    Don't Get Sued: 5 Tips To Protect Your Small Business

    Find out what you can do to limit risk and keep your business running smoothly.
  2. Home & Auto

    Cover Your Company With Liability Insurance

    Every business is susceptible to legal action. Find out how to protect yours.
  3. Home & Auto

    Protect Your Company From Employee Lawsuits

    Understanding employment practices liability insurance is easy, once you know the basics.
  4. Insurance

    Who Needs Extortion Insurance?

    Insurance can help mitigate the financial damage of an extortion plot, but it’s important to read the fine print before taking out one of these policies.
  5. Insurance

    Do You Need Kidnap & Ransom Insurance?

    Americans working abroad – and high-profile individuals traveling frequently in kidnapping hot spots – should consider this type of protection.
  6. Insurance

    A Guide To Kidnap & Ransom Insurance

    Every year, thousands of people are kidnapped for ransom all over the world. This insurance offers protection – and peace of mind.
  7. Insurance

    Should I Insure My Wedding Ring?

    It depends, in part, on the ring's value and your current insurance coverage. Here's a guide to making a decision that's right for you.
  8. Insurance

    How To Insure Your Wedding Ring

    Read on for everything you need to know to make sure this precious possession is covered against theft, damage, loss and more.
  9. Insurance

    Should You Insure Your Wedding Dress?

    It can be money well spent that ensures your gown is ready for your big day. Plus, insurance covers a groom's and other attendants' clothing.
  10. Insurance

    3 Reasons To Get Umbrella Insurance

    A relatively small annual premium can buy you a lot of peace of mind. In today's litigious society, that's money well spent.

You May Also Like

Hot Definitions
  1. American Dream

    The belief that anyone, regardless of where they were born or what class they were born into, can attain their own version ...
  2. Multicurrency Note Facility

    A credit facility that finances short- to medium-term Euro notes. Multicurrency note facilities are denominated in many currencies. ...
  3. National Currency

    The currency or legal tender issued by a nation's central bank or monetary authority. The national currency of a nation is ...
  4. Treasury Yield

    The return on investment, expressed as a percentage, on the debt obligations of the U.S. government. Treasuries are considered ...
  5. Bund

    A bond issued by Germany's federal government, or the German word for "bond." Bunds are the German equivalent of U.S. Treasury ...
  6. European Central Bank - ECB

    The central bank responsible for the monetary system of the European Union (EU) and the euro currency. The bank was formed ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!