When and Why to Shop for Malpractice Insurance



The question I get from my existing client base on a yearly basis is "why do we shop for malpractice insurance and when do we shop?" I’ve developed what I think is the best way to approach this question.

First, your broker should give you an overview of the market, including rates and policy forms, on an annual basis. Brokers prepare this overview by looking at filed rates and sharing those with the client. You should not only share pricing but also each company’s benefits, such as financial ratings, company histories, and policy forms. Although these rates do not represent what the insurance company will charge you, it gives you a good estimate of where the market stands, a good overview of each company, and reasons for why you should consider them. 

Second, I believe that you should conduct a thorough marketing review every 2–5 years depending on several factors, including your current pricing, specialty, policy features, and personal preferences. During a thorough marketing review, you should complete a new application and obtain other required items to submit to underwriting for a firm quotation. Once that is complete, the quotes should be assembled and shared with you in a non-biased fashion. Brokers work for you, not insurance companies. Every broker should be able to thoroughly explain policy features, company histories, financial ratings, and many other factors.

Lastly, you need to ask yourself whether you will perform these steps with your current broker or by yourself. At Arthur J. Gallagher & Co., we perform these services for our clients on a daily basis and it costs you nothing. We are experts in this field, and we would love the opportunity to discuss our services with you.


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