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The financial burden of opening a private medical practice is so high that you’d want to take the necessary incentive to ensure you stay afloat in case of any eventualities. According to Doctorly, the estimated financial cost of opening a medical practice can accumulate up to $100 000 with $ 6,000 incurred monthly expenses as aptly put by physician practice specialists.
Some minor and major accidents may occur at your establishment that may lead to suits. Therefore, to ensure your business absorption from any financial shock, it’s advisable to buy these three main insurance policies without which your business will be hard to operate.
- Property Insurance
- Medical Professional Liability Insurance
- Business Liability Insurance
3 Main Medical Insurance Policies That Your Medical Practice Can’t Operate Without
The estimated number of suits filed against medical practices in the United States is 17, 000 with one out of three practitioners affected. This translated to an estimated 34% of medical practitioners litigated.
These three medical insurance policies will ensure you have peace of mind in case of damages to your establishment or any lawsuits filed against you due to negligence or injuries.
Property insurance covers an array of weather-affiliated damages from wind, hail, fire, snow, tree, etc., and theft-related damages. According to the Insurance Information Institute, the top three damages claims resulted from wind and hail, fire and lightning, water damages, and freezing.
The total percentage of these damages, as of 2018, was estimated to be 90.9 with 34.4%, 32.7%, and 23.8%, respectively. The average wind and hail claim was estimated to be about $11,200, and for fire and lightning, amounting to an average cost of $79,785.
Medical Professional Liability Insurance
This is one of the mandatory insurance a medical practitioner is required to have throughout the states. Besides compensatory and punitive damages, if found liable, professional liability insurance also covers arbitration costs, medical damages, court costs and attorney fees, settlement costs.
The Insurance Information Institute estimates that every medical practitioner, at the course of their career, will receive at least one malpractice lawsuit. With the average malpractice insurance cost amounting to $7,500 annually and the standard policy pay amounting to $1 million, it would be prudent to cover your business if you’re culpable.
Business Liability Insurance
Usually referred to as General Liability Insurance, it will cover your business in case of personal, property, or advertisement damages inflicted by your services. It can either be through your employees or business operations.
The annual average cost of general liability insurance is approximately $636 but varies depending on the business you’re running. Currently, in the US, there are over seven million small businesses, and though they’re more susceptible to liability claims, 40% of the owners don’t see the need to have business liability insurance.
Taking Care Of Your Medical Practice Business
With over 80% of physicians stating how overstretched they are, it shows the demand for medical practitioners. On average, a physician receives about 11-20 patients a day and spends over 25 minutes or more with each of the patients.
Factoring these statistics, including calculation of overhead costs, operations costs, capital expenses, and funding options, you’ll be able to make an informed decision on whether to go ahead and set up your medical practice business.