Medical malpractice insurance is expensive. In fact, insurance premiums in some parts of the country have become so high, that many doctors have simply decided to skip buying insurance altogether in a phenomenon called “going bare.” Other doctors are choosing to increase their coverage, in order to protect their assets when, and if, they are sued. So, does buying more medical malpractice insurance help you protect your assets when a verdict goes against you?
The advantage of getting more medical malpractice insurance is that some of your personal assets may be protected from liability as a result of a fatter policy. However, we have noted that the higher the medical malpractice insurance, the higher the likelihood that you may be sued. Having a higher limit policy could actually increase the risk of being sued, because plaintiffs and their lawyers know that they have a substantial size of liquid assets that will be readily available to them.
Lawyers don’t take on medical malpractice cases on an upfront fee. Rather, they try these cases on a contingency fee basis. That means that a plaintiff doesn’t have to pay his lawyer at the very outset. He only has to pay his attorney a percentage of the damages that he receives. When a doctor has a high medical malpractice insurance policy, it can act as an incentive for an attorney to push his client towards a lawsuit. If your policy amount is high, the attorney is likely to push his client to sue you, because of the possibility that he (the lawyer) will be well compensated for all his litigation efforts. That may not happen if you have a low policy amount.
The bottom line therefore, is that buying more medical malpractice insurance could actually place you at a higher risk of litigation, without really being worthwhile as an asset protection tool. For solid ways to protect wealth, doctors need to look at asset protection.
Business insurance is one area where many small and meduim size Pinoy Bizmen, specially the single prop in the countryside, overlook, fail or simply disregard and end up self insuring or taking the risk by themselves. Sometimes, it is treated as the last priority or may not be considered in the budget planning at all. They start to appreciate the significance of it only when they of know of another trader who never recovered or resumed operations after experiencing a fire or liability loss. Being in this industry, we looked at it as our responsibility to share with them the importance of insurance in their growth or survival when uncertainties do happen. In our own little way, we have contributed something to the biz community and the local economy as well.