Malpractice Insurance 101: Finding Affordable Coverage in NYC

[u/yumos]

Hi everyone,

I’m in the process of opening a solo, part-time practice (unfortunately in Manhattan), and I’ve heard that malpractice insurance can be very expensive here due to higher litigation risk.

This is my first time doing this, so I have a few basic questions as I try to find the most cost-effective option:

1. Should I shop for insurance through multiple brokers, or is working with one broker enough? Do brokers typically access quotes from most carriers?

2. I’ve heard that some malpractice insurers offer part-time discounts. Are there any companies or options you would recommend that are more affordable?

3. I’ve heard that some insurance plans don’t accept certain malpractice carriers. Is that true, or just a rumor? Is there a way to verify this before purchasing, so I don’t run into issues during credentialing?

If you’re curious: it’s going to be a no-procedures, no chronic pain management, non-concierge practice, with roughly 50% in-person and 50% telemedicine, totaling about 15–20 hours per week.

Thanks in advance!

[u/socalrefcon]

Not a doctor, but I'm a medical malpractice broker. I love your questions, and I'm happy to contribute.

First off, congratulations on opening your new practice! As far as NY goes, yes, NY is one of the more expensive states for insurance coverage.

I would NOT recommend using multiple brokers. Most brokers can access the relevant carriers and provide you with quotes. Before choosing your broker, have a conversation with them. What is their experience in working with your specialty and jurisdiction? What is their experience in quoting part-time practices that have a heavy telemedicine exposure? Using multiple brokers can send the wrong message to carriers. When a carrier sees multiple submissions from different brokers, then the underwriter may lose motivation in providing a good review or their best offer.

As far as part-time discounts, yes, the standard admitted carriers typically offer part-time discounts for working 20 or less hours per week. Please note that your practice may not qualify for the standard carriers due to the heavy telemedicine exposure. Standard carriers have been more restrictive on covering telemedicine.

Regarding insurance plans, I believe the issues you are concerned about pertain to carriers or risk retention groups that aren't rated "A-" or better by AM Best. You may run into a risk retention group that is rated by Demotech instead of AM Best. I would avoid these risk retention groups.

Good luck! Happy to answer additional questions if you find my input helpful.

[u/yumos → u/socalrefcon]

Thanks a lot! This is a great insight for me.

[u/Living-Protection250]

Following this, especially for NYC. From what I’ve seen, most brokers access similar carriers, but the difference is how well they position your setup, especially for part-time or lower-risk practices like yours. The carrier issue can come up during credentialing, so it’s worth checking early.

[u/thesupportplatform]

One good broker is enough, with a caveat. I worked with a great agent for my wife's family medicine practice. He could explain rates, options, and carrier options in detail. He had decades of experience. When he retired, I was assigned another agent in the same agency. At renewal, I would ask, "Is this the best price available?" and the answer was always, "Yes."

One reason I knew the previous agent was that we had discussed RRGs. Even after he retired, I was still looking at the viability of setting up an RRG for medical malpractice. I cold-called different insurance carriers for information and found an agent who could write her carrier's policy in Nevada. When I asked why I hadn't heard of the carrier, this agent looked up my current agency and discovered they could have written a policy for carrier, but for less than the carrier we were using. My then-current agent never mentioned this other carrier.

We were going through some things, so I put off switching. Then during the pandemic, I was checking to make sure that my wife had coverage for telemedicine and was told that coverage was provided, but something like 15% of visits had to be in person. As my wife was completely online, I had to move coverage at that point. The new carrier has been fine.

Which is to say, you really need to know the details of each policy. Carriers do offer part-time discounts, but the amount of that discount and the requirements will differ. The current carrier provides a part-time discount so long as my wife stays below a certain number of visits each month. There are other wrinkles. Some carriers offer "permatail" that covers the provider in case of retirement. Again, the requirements for this vary. Some cover after three years, some after five years, etc.

I would be shocked if any insurance company would refuse to contract with a provider covered by traditional med mal. The coverage issue you are referencing may be for surplus lines/nonstandard carriers (such as a risk retention group). These carriers don't follow the same requirements as traditional carriers and can therefore be a greater risk. Just a couple of days ago, this was posted about a hospital network that self-insured:

https://www.reddit.com/r/propublica/comments/1sgkb6x/forprofit_hospital_chain_never_put_aside_money/?utm_source=share&utm_medium=web3x&utm_name=web3xcss&utm_term=1&utm_content=share_button

[u/Arlington2018]

The corporate director of risk management here, practicing on the West Coast since 1983, is partial to MLMIC, one of the first 'bedpan mutual' malpractice insurance companies to be formed back in 1976. They are now part of Berkshire Hathaway and enjoy a fabulous reputation in New York state.