About Malpractice Insurance / Professional Liability Insurance for Counselors
Malpractice Insurance (aka Professional Liability Insurance or Errors & Omissions Insurance) covers liability suits against your practice that allege your services caused harm or financial loss.
For example, say a mental health counselor began an inappropriate relationship with a client. He began revealing personal information about himself to the client that had no therapeutic value and encouraged the client to meet him for a social engagement outside the office. A sexual relationship emerged while he was still offering the client counseling sessions. When the client discontinued the counseling sessions, the counselor failed to assist her in obtaining another counselor. Because the counselor breached clinical, ethical, and legal standards of care, the plaintiff's attorney initially sought $500,000. However, the case was settled out of court for $150,000 (plus an additional $11,780 paid in legal costs).
Unfortunately, cases like this are not anomalies. As more people gain access to the therapeutic help they need in order to live healthy lives, malpractice suits are becoming more common. When you have Malpractice Insurance, it covers lawsuits over…
- Professional negligence.
- Breaches in standard of care.
- Provision of shoddy services that jeopardize a client's health.
- Failure to treat or protect clients appropriately.
- Misrepresentation of services to entice a prospective patient to agree to a contract.
Malpractice Insurance is claims-made coverage , which is based on two conditions. Your policy must be active when an alleged incident occurs and when the lawsuit is filed against your practice. If these conditions are both met, your policy can cover your attorney's fees, settlements, and other costs related to the initial charge (depending on your limits).