Be Ready. Be Covered. Be Sure.

Nurses often wonder if purchasing their own, individual professional liability insurance, in which they are the named insured, is really necessary. The following case is one to consider when deciding if you are going to purchase professional liability protection for yourself.

Ms.Cohen an R.N., was a genetic counselor working with Dr. AG. Dr. AG provided OB-GYN services and genetic counseling to his patients. A client sued Ms. Cohen and Dr. AG and alleged that Ms. Cohen had “negligently rendered counseling services”. (2)  Ms. Cohen believed she should be covered under  Dr. AG's policy and filed a declaratory judgment action seeking a verdict in her favor without a trial that she was indeed covered under the Dr. ’s professional liability insurance policy.

During court proceedings, the language of the policy was brought into question in terms of the coverage.  The policy clearly covered Dr. AG, his solo practice, his administrator, a substitute physician, and his estate. (3)

The policy also contained the following language: "Be sure you understand that you are not covered under this policy for the acts of certain people in your employment for whose conduct you are responsible unless they are insured under a separate professional liability insurance policy."

The policy went on to state that if employees were covered under a separate professional liability insurance policy, Dr. AG insurance would cover the excess of the liability claim coverage provided by the employee’s policy.  It also listed certain individuals who would be excluded from this coverage section: employed physicians, physicians’ assistants, specialists’ assistants, nurse practitioners, and nurse midwives employed by Dr. AG. (4)

After serval appeals, an appellate court held that there was no evidence to support the argument that Ms. Cohen would be covered under his policy given the above circumstances.

It was determined that Ms. Cohen was not an employee of Dr. Gardner’s but rather an independent contractor.  Thus, no coverage was available for her under the Dr.’s professional liability insuranc.

This case illustrates several points regarding a nurse practitioner need for their own professional liability insurance policies:

  1. You  need to purchase and  maintain your own professional liability insurance policy;
  2. If you are an independent contractor, you  must purchase your own professional liability policy;
  3. If you are an independent contractor and  have employees of your own, you need to make certain the employees are covered under your policy or that they purchase their own policy;
  4. If you are an employee or purchase your own policy, carefully read the professional liability insurance policies and/or any others upon you rely (e.g., an employer’s policy);
  5. When unclear about a certain provision or provisions in a professional liability insurance policy, seek clarification from the insurance company’s agent;
  6. If relying on an employer’s professional liability insurance policy, ask for a copy or ask to read the policy in order to determine if you are a named employee if you are covered under an endorsement to the policy, or if you are excluded from certain provisions, as examples;
  7. Carefully scrutinize the definition of  nursing practice in any policy and  decide if it includes your role at your place of work or your role as an independent contractor;
  8. When purchasing your own professional liability insurance policy, obtain as much coverage for individual and aggregate claims during the policy period as you can afford; and
  9. If you are purchasing your own professional liability insurance, purchase an occurrence policy rather than a claims-made policy.

FOOTNOTES

Cohen v. Medical Malpractice Insurance Pool of New York State, 56 A.D. 3d 2008.

A. David Tammelleo (2008).  NY: Nurse Not Covered Dr.-Employer's Policy: Nurses Should Have Their Own Professional Ins,49 (7) Nursing Law's Regan Report, 3.

Cohen v. Medical Malpractice Insurance Pool of New York State, 2010 N.Y. Slip Op. 30784(U) (2010).