Ask A Nurse: What Is Personal Liability Insurance And Should I Get It?

What it is

Personal liability insurance protects you financially if a patient or their family sues you over the care you provided as a nurse. According to the Nurses Service Organization (NSO), the average nurse's malpractice claim costs $201,916. A few states require nurses to carry it, but for most of us it is a personal call.

You will see it called several things: medical malpractice insurance, nursing malpractice insurance, or errors and omissions insurance.

Why nurses carry it

Carry your own policy even if your facility covers you. When a claim hits, the facility protects itself first, and its coverage for you can be limited, leaving you on the hook for the rest. That is when your personal policy kicks in. Nurses on the floor have a blunt name for getting left exposed: thrown under the bus.

A personal policy typically covers medical negligence, HIPAA violations involving patient records, misrepresentation, and incorrect advice. It also pays legal fees (defense, judgments, settlements) and reimburses lost income from time spent at trials or depositions.

The downsides come down to cost, plus limited coverage, dense policy language, and potential gaps between coverage dates. If it does not fit your budget or you already carry other malpractice coverage, you may decide to skip it.

Why nurses get sued

Negligence that harms or kills a patient is the big one, along with allegations about the care a nurse or the team provided. Some states let patients sue for up to 10 years. Other common triggers are medication errors, unprofessional conduct, failure to act, and injury.

Types of coverage

You will choose between two basic structures, so research which fits you.

Claims-made coverage pays for claims filed during your policy period. You can add a retroactive date (which covers an incident that happened before your policy started but is claimed during it) and an extended-reporting period (which covers claims for a window after your policy ends, usually 30 to 90 days).

Occurrence-based coverage covers any incident that happened during your policy period no matter when the claim is filed. It costs more because the protection stays active for so long.

You can also stack on other policies. Workers' compensation covers work-related injuries and follow-up care like physical therapy. Commercial property insurance protects your home, office, and medical equipment if you run your own nursing business.

Picking the right policy

Do your homework. Ask other nurses which policies they hold and how satisfied they are. Most insurers will give you a quote and let you buy online or over the phone.

According to NSO, most claims resolve for less than $100,000, but 3.1% pay out the full $1 million policy limit. Your monthly or annual cost varies by company and state. And do not assume seniority protects you. NSO reports experienced nurses are more likely to be sued than new ones. Think of personal liability insurance as something you buy, forget about, and remember to renew before it expires.

Bottom line

Personal liability insurance protects you financially if a patient or their family sues. Nurses most often get sued over negligence that harmed or killed a patient. To pick the right coverage, research your options and ask other nurses what works for them.