Many physicians and office administrators are confused by the terminology used by medical malpractice insurance brokers, and why shouldn’t they be? Most fields have an insider’s lingo used by people that work in the industry. However, the medical malpractice insurance business seems to expect everyone in the healthcare world to understand and crack our secret codes.
Believe it or not most medical professional liability insurance policies are fairly simple compared to other types of insurance. These are basic liability policies with a couple of extra bells and whistles. A few of the commonly used terms that may be unfamiliar are:
What Exactly is Tail Coverage?
Another name for the “Extended Reporting Endorsement” (ERP), which is supplemental insurance that covers claims that may arise after the policy is cancelled. Claims are covered if the incident occurred after the Retroactive Date but before the date of cancellation of the policy. The cost for Tail Coverage is typically 150-250% of the premium at the time of cancellation.
What is a Retroactive Date or “Nose Coverage on Prior Acts?”
This is the date that the Claims-Made policy provides coverage for going back in time. The Retroactive Date is usually the date you first started on a claims-made policy.
What is a Declarations Page?
This is the front page or “face sheet” of the policy that shows a summary of the coverage and includes important information about the policy. This is typically also referred to as a certificate of insurance. The retroactive date is included on the declarations page of the policy. If your policy is a tail policy, your declarations page will reflect the retroactive date. Your tail policy will also include the extended reporting period endorsement as part of the policy.
Most medical liability insurance professionals probably don’t realize they are using terms unfamiliar to others, so when speaking with a medical malpractice insurance specialist, make sure you ask questions so that you’ll understand what your coverage includes.