How Much Does Medical Malpractice Insurance Cost? (2023 Rates)

Thang Truong
Thang Truong
Updated on:

Professionals working in the healthcare industry make mistakes, especially in stressful situations. 

  • Perhaps a doctor makes an incision a few millimeters off the mark. 
  • Or maybe the patient has an unexpected reaction to a prescription drug.
  • Or a nurse forgets to check a patient’s blood pressure, and he has a heart attack shortly after.

Medical professionals are careful people — and they care deeply about their patients — but they can make mistakes. However, a minor error can result in a significant issue for a patient and their family. They often sue the medical professional who made the error. The costs of lawsuits and settlements can easily top one million dollars, and if the incident is severe enough, a doctor, nurse, or other medical professional could lose their license and livelihood.

One way medical professionals can protect themselves from these lawsuits is with medical malpractice insurance. Without this coverage, doctors, nurses, home healthcare aides, pharmacists, and others could lose their business and personal assets because of a lawsuit. Assets could include their home, savings, vehicles, and more. The coverage is so critical that most medical professionals cannot practice without a significant amount of medical malpractice insurance protection.

In this article, I’ll explain how much medical malpractice insurance costs and everything you need to know to get the coverage that’s right for you.

How much does medical malpractice insurance cost?

The average annual cost of malpractice insurance across all medical professions is $7,500. However, there are many types of professionals doing healthcare work. On the high end, surgeons typically pay between $30,000 to $50,000 a year for malpractice insurance, but that could go higher for riskier forms of surgery. Other medical personnel should expect to pay between $4,000 and $12,000 a year for malpractice coverage.

Different insurance companies will give you different quotes and offer you different rates. Be sure to shop around with a few companies or with a digital broker to compare several quotes before making your final decision. It is a significant expense for your healthcare practice, you owe it to yourself to shop around to find the cheapest one.

What factors affect the medical malpractice insurance cost? 

The cost of medical malpractice insurance varies because of all the factors that go into calculating premiums. These include:

State malpractice insurance requirements.

Each state has different regulations and requires medical practitioners to get different levels of malpractice insurance.

Where the healthcare practice is located.

Medical professionals are more likely to be sued in certain parts of the United States, especially large cities, which increases costs.

Type of medical practice.

Different types of medical practices need different types and levels of coverage. For example, a larger medical practice would need different coverage than a pharmacy.

Type of healthcare predictions.

Different types of medical professionals face a range of risks. Some perform open-heart surgery, while others do nose swabs. Both types of work are essential, but the risk levels are entirely different.

Malpractice claims record.

A healthcare business that has made claims on their malpractice insurance will pay more for coverage than one with a clean record.

It’s important to get quotes from multiple insurers to ensure you’re getting the coverage you need at a fair price.

Who needs medical malpractice insurance?

Any medical professional working in the United States must have medical malpractice coverage, including:

An insurance agent or company representative experienced in medical malpractice insurance can advise you on the coverage you need.

How much does medical malpractice insurance cost by different healthcare specialties?

Almost all healthcare specialities need malpractice insurance coverage. Different specialties are exposed to different levels of risks, and thus their medical malpractice insurance costs are also different. Below are the average medical malpractice insurance costs for different healthcare specialties based on our research:

ProfessionAverage annual cost of malpractice insurance
Physician Assistants$4,000 
Nurse Practitioners $650
Nursing Students $35
Dentists$400 for a new dentist, $2,000 for established dentists
Dental hygienists$65
Psychologists and counselors $1,125
Chiropractors $540 
Physical therapists $157
Acupuncturists $120-$200

Learn more at the cost of malpractice insurance cost by specialty.

What is medical malpractice insurance?

Medical malpractice insurance, often referred to as medical professional liability coverage, is designed to protect physicians, nurses, pharmacists, and other medical professionals working in the healthcare industry.

The insurance coverage provides protection when wrongful practices result in bodily injury, property damage, medical expenses, and pain and suffering.

Here’s an example of a scenario where having medical malpractice insurance is critical. A man goes into the hospital with severe abdominal pain. It turns out he needs an emergency appendectomy. A few weeks later, he continues to have pain. X-rays revealed a metal medical tool near his stomach. The patient required a second surgery to remove the piece of metal the first surgeon left in him. He sued the doctor and hospital and received a large settlement.

Because the surgeon and hospital had adequate medical malpractice coverage, neither was responsible for paying legal or settlement costs.

What does medical malpractice insurance cover?

Medical malpractice policies provide liability coverage to medical professionals found to be negligent in doing their job. It also covers legal costs when doctors, nurses, and others are sued even when found not to be negligent. Medical malpractice insurance pays for:

  • Court costs and fees
  • Legal help
  • Discovery costs
  • Settlement costs
  • Medical damages
  • Punitive damages.

What does medical malpractice insurance not cover?

While medical malpractice provides medical professionals with a comprehensive level of protection, it doesn’t cover everything. It does not cover sexual misconduct, criminal acts, and intentional misrepresentation.

Tip: The hospital or other organization the medical professional works for needs to have employer’s practice liability insurance (EPLI) as part of their business insurance coverage. EPLI insures claims that fall into the sexual misconduct and criminal acts categories.

What else do I need to know about medical malpractice insurance before buying it?

You will be asked to choose one of two types of malpractice insurance policies:

Claims-made medical malpractice insurance

This coverage only offers protection while the policy is in effect. This means it must be in effect when the medical incident occurs and the lawsuit is filed. If not, the policy will not pay out under any circumstances. Because many medical lawsuits are not filed until long after the malpractice occurs, most medical professionals purchase a tail to extend the coverage to include a more extended period of time for lawsuits to be filed.

Occurrence-made medical malpractice insurance: 

This coverage offers protection for any medical malpractice event that happens when the insurance is in effect, even if the policy has lapsed when a claim is filed. Most medical personnel prefer these policies because they offer better protection. However, they  are not available in all states.

If you want to save money on medical malpractice insurance, claims-made coverage is generally cheaper than occurrence made, but if you add on a tail, the costs become more similar.

How does tail insurance work in medical malpractice insurance?

Tail insurance is added to a claims-made policy and ensures that the medical professional is covered for a set amount of time after the coverage ends for lawsuits related to incidents that occurred while the policy was in effect but filed after it ends. Tail coverage usually lasts five to ten years after regular malpractice coverage ends. 

How to lower your medical malpractice insurance cost? 

As I’ve already covered, the price of medical malpractice coverage varies. It’s dependent on many factors, including the type of practice, size of the operation, years of experience, claims history, location, and other things. Here are three things you can do to reduce costs:

1. Avoid making malpractice claims.

Working carefully and thoughtfully with patients, and ensuring everyone at your healthcare organization does, too, will help prevent your healthcare costs from going up.

2. Stay educated.

It’s easy for even the best healthcare practitioners to get stale or fall behind the latest medical advances. That’s why it’s a good idea to constantly refresh your education and ensure everyone who works for you does too.

3. Get malpractice insurance quotes from multiple providers.

The best way to make sure you’re paying a fair price for your malpractice coverage is to get quotes from multiple providers. That way, you can compare coverages and costs to find the best combination for you. 

If you have any doubts about your malpractice coverage or other business insurance, speak with an experienced agent or company representative.

Thang Truong
Thang Truong

Thang Truong covers small business insurance and small business success at BravoPolicy. He is a licensed P&C insurance agent. Previously, he held product leadership positions at, Capital One, NerdWallet, and Mulberry Technology. He holds a MBA degree from UC Berkeley - Haas School of Business.

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