NACAMS Liability Insurance Guide
Q: What is professional liability insurance?
A: Liability insurance is a part of the general insurance system of risk financing to protect the purchaser (the "insured") from the risks of liabilities imposed by lawsuits and similar claims. It protects the insured in the event he or she is sued for claims that come within the coverage of the insurance policy.
Q: Do I really need professional liability insurance for complimentary and alternative medicines?
A: You can, of course, forgo any insurance and assume the entire risk. You can do this as long as you can be assured you will not suffer a major loss. However, since risk is impossible to predict, a better option is to pass any risks you feel would be detrimental to you, your CAM business and/or your family to a massage liability insurance carrier.
Q: When should I buy liability insurance?
A: You should consider purchasing CAM liability insurance when you begin your career as a massage therapist. Coverage is also generally available to students at discounted rates under man programs.
Q: What are the kinds of coverage provided by liability insurance?
A: Most Liability insurance plans include professional liability (malpractice), general liability (trip and fall) and product coverages (eg, adverse reaction to an oil or lotion). Some programs offer additional coverage as well. You should check with the program sponsor for details.
Q: How much should I buy?
A: Most liability insurance programs offer liability protection at $1 million or $2 million dollar coverage per occurrence per year. Annual aggregate coverage generally ranges between $2 million and $3 million.
It is important to note the difference between "occurrence form" and "claims made" coverage. Occurrence form coverage means claims arising out of incidents that occur during the policy term are covered even if they are reported after the end of the policy term. Claims made coverage means claims arising out the incidents that occur during the policy term are covered only if they are also reported before the end of policy term. Some claims made policy forms allow for an extended reporting period beyond the policy term. Occurrence form coverage or claims made coverage with an extended reporting period are generally the best options, compared to pure claims made coverage.
Q: How do I know a liability insurance carrier is legitimate?
A: Check ratings of massage liability insurance carriers with some of the major rating agencies, such as A.M. Best Company, Weiss Ratings, Standard & Poor’s, or Moody’s Investment Services. Look for an “A” rating or better.
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Q: How can I be sure I am choosing the best program for my needs?
A: Research the websites of the various massage liability insurance providers and spend the time to compare the benefits and costs of each program. Some of these sites provide an online comparison of their program with those of the competition. Speak to their licensed representatives as necessary to help you to make an informed choise as to what massage insurance program best meets your needs and objectives.
Q: What are the additional benefits to having liability insurance?
A: Additional benefits vary widely by provider but some of the best offers include FREE Identity Protection Insurance, FREE Lost or Stolen Equipment Coverage, a FREE Business Website, and a FREE directory listing on an industry leading website, and a FREE industry newsletter.
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