Florida Dentists are retiring. What are the dental Malpractice insurance considerations?
As more and more Florida dentists and oral surgeons consider retirement, what should they be thinking about as far as their dental malpractice insurance is concerned?
Being Sued After Retirement
A Florida dentist should make sure that he is covered for future dental malpractice insurance claims that might be levied against him after he closes his dental practice. Because of the long nature of dental malpractice claims, patients may sue their dentist or other healthcare provider long after the actual work was done.
The occurrence malpractice insurance policy
If a Florida dentist has an occurrence policy, the process of setting up insurance for retirement is fairly simple. The occurrence policy works like automobile insurance. The Florida dentist purchases the occurrence policy for a set period of time (usually one year) and coverage is provided up to the policy limits for work done during that year, regardless of when a malpractice lawsuit is brought. If the Florida dentist cancels the occurrence policy when he retires, and then has a claim brought against him, he is covered by the policy in force when the incident occurred. So, a Florida dentist with an occurrence policy can essentially cancel it upon retirement and not worry about future dental malpractice claims.
The claims-made policy
If a Florida dentist has a claims-made policy, he needs to be sure that he has planned for claims that might be brought against him after he retires.
The claims-made medical malpractice insurance policy covers claims brought against the Florida dentist during the policy period, as long as the work was performed after a set date (retroactive date). When a Florida dentist retires, he cannot just cancel the claims-made policy and walk away. He needs to be sure that a “tail” policy is in place. The “tail” policy will then cover him for the rest of his life (and his estate beyond that) for any claim reported after the cancellation of the claims-made policy, as long as the work was done after the retroactive date and prior to the issuance of the “tail” policy.
A free vs. purchased “tail” policy
Most Florida dental malpractice insurance companies make provisions for the “tail” policy. Some companies offer a free “tail” policy if the dentist has been insured by the company for five or more years and completely retires from the practice of dentistry. (He may be able to practice dentistry on a volunteer basis.) There may be an age stipulation (retire after age 55, for example). Other companies automatically offer the Florida dentist the option of purchasing a “tail” policy, thus allowing the dentist the ability to submit a claim after he retires and after the regular dental malpractice insurance policy is cancelled.
If the Florida dentist has to purchase a tail policy, the cost can be 1.5 to three times his annual premium. For this reason, it is imperative that the dentist know his tail options well in advance of his retirement.
If the Florida dentist is thinking about switching dental malpractice insurance carriers with retirement on the horizon, he should discuss the tail implications with his dental malpractice insurance agent. It may not make sense to switch, even if the annual premium is lower, if he cannot qualify for a free tail upon retirement. The new dental malpractice insurance company will not honor his time with the previous dental malpractice insurer as far as earning a free tail is concerned.
Another point to remember is that the company from which a Florida dentist purchases or is given a tail policy should be financially strong. Once the tail policy is purchased or earned, that coverage is locked down with the dental malpractice insurance company for the entire retirement. The tail policy cannot be cancelled once bound. If the dental malpractice insurance company becomes insolvent, the dentist is on the hook for a claim that might be brought against him.
As a Florida dentist can see, it is extremely important to be represented by a dental malpractice insurance agent who understands the complex issues of dental malpractice insurance, and specifically tail insurance. The peace of mind a dentist has earned can be shattered in retirement by a faulty decision on dental malpractice insurance.
We at Gracey-Backer, Inc. are Florida’s leading dental malpractice insurance agency. We represent four of the strong dental malpractice insurance companies in Florida. Not only can we “shop” your insurance among our “A” (Excellent) rated carriers, but our professional agents can advise you on this and other important medical malpractice issues.