How much should you pay for malpractice insurance? $4,000? $5,000?

By: Dr. Luke Shapiro

I just got off the phone with my insurance sales rep and they informed me that it would now cost me almost $11,000 to have malpractice insurance in New York City! What?!

I thought I misunderstood. Is it even legal to increase malpractice by this much?

Turns out it is. They can increase however much they want, whenever they want.

Rising Malpractice Insurance Costs

First, let’s explore why the company is doing this. Supposedly, there have recently been a lot of lawsuits in New York City, and the company is unable to support the claims and basically kicking out all New York City orthodontists from their insurance.

Next, let’s explore how they did this. The company sent a couple of e-mails and that was it! No phone call, nothing. Some orthodontists have been with this company for 40-plus years. That’s hundreds of thousands of dollars given to the company and this is how they say goodbye? A simple e-mail?

Plus, some dentists don’t even read their e-mail or it gets sent to junk. So, many orthodontists read the news on Facebook or found out through a text with a friend.

AAOIC

Now, this post isn’t to put this malpractice insurance company on blast, I simply want to share my experience! AAOIC is the official insurance of the American Association of Orthodontists (AAO). I thought the AAO would try to fight for us on our behalf, but I was severely mistaken. It is not because the AAO doesn’t care, but that’s not how a sponsored company relationship works.

Furthermore, it seems to me that the AAO was completely unaware of this rate increase as they said to us in a letter, “We appreciate your alerting us to the substantial rate increase.” Huh?!? They then went on to say, “We were equally surprised at this increase. Although AAOIC is the AAO-endorsed partner for professional liability insurance coverage, it is not a department of the AAO; rather, it is a separate company.”

I think there are a lot of important lessons to be learned here and questions that should be asked of insurance companies when you are making your decision of where to sign up.

Occurrence-Based Insurance

On another note, if you are a new grad, I highly recommend getting occurrence-based insurance. Many employers will require you to have that type of insurance.

If you don’t buy occurrence and buy claims-made, there are many employers that will require you to buy a tail if you decide to leave the practice. A tail is another sneaky way that an insurance company can charge you a lot of money. A tail can cost around $20,000 depending on which company you have and how many years you have been working.

Finding Cheaper Malpractice Coverage

There are other companies out there with great deals! For example, MedPro has $50 for new grads with discounts for the first few years out. If there are other companies out there with great rates, please let us know! 

I hope this has helped you! I’m not trying to scare you, but rather just want to let you know about the possibilities! Please make sure you flat out ask insurance companies if they have had drastic rate increases in the past or how much they typically increase per year. It will save you a lot of time and aggravation in the future!

Next Up: How Dental Students Can Save For Their Own Practice

Photo by RODNAE Productions

lucas.shapiro

lucas.shapiro

Dr. Lucas Shapiro is a graduate of Washington University in St. Louis and Stony Brook University School of Dental Medicine, where he received his Doctor of Dental Surgery. He completed his post-doctoral orthodontic training at Tufts University School of Dental Medicine. He currently practices orthodontics at Lemchen Salzer Ortho in NYC. He started the Instagram page @futuredentists, works with the educational organization @ignitedds and has an orthodontic TikTok page @drshap.