You Get a Records Request That Feels Off
It starts small. A patient or their attorney asks for a copy of the medical records. Maybe it's a routine request, but something feels different—the tone, the scope, the timing. You might feel a knot in your stomach. Trust that instinct.
In many cases, a records request is the first concrete sign that a patient is considering legal action. It doesn't mean you'll be sued, but it's a signal to pay attention. According to Berxi, a leading insurer for healthcare professionals, the first step after any incident that could lead to a claim is to notify your malpractice carrier—even before you're formally sued. Many policies require you to report circumstances that could reasonably lead to a claim.
Don't ignore it. Don't try to handle it alone. If you have your own malpractice insurance, your carrier will guide you through the process. If you don't, you're on your own—and that's risky.
A Subpoena or Demand Letter Arrives
If a records request escalates, the next step might be a subpoena for your testimony or documents, or a demand letter from a lawyer outlining damages. A demand letter is essentially a pre-suit negotiation: the patient's attorney lays out why they believe you're liable and asks for a settlement amount.
This is the point where many practitioners panic. But having your own policy changes everything. With a carrier like Berxi or HPSO, you can forward the letter to your insurer, and they'll assign a defense attorney. That attorney will handle communications, evaluate the claim, and advise you on next steps. Without a policy, you'd have to hire a lawyer on your own—easily costing thousands.
You Receive a Board Complaint or Licensing Inquiry
Sometimes the first sign isn't a lawsuit but a letter from your state licensing board. A patient files a complaint about your care, and the board opens an investigation. This is serious: a board inquiry can threaten your license, even if the patient never files a malpractice suit.
Most employer-provided malpractice policies do not cover license defense. That's a critical gap. Policies from Proliability (Mercer) include up to $25,000 per incident for license board reimbursement, and CPH & Associates offers $35,000 in state licensing board defense. If you're a therapist, psychologist, or social worker, this coverage is essential—your license is your livelihood.
Why Employer Coverage Isn't Enough
Your employer's malpractice policy protects the facility first. It may not cover you if you leave the job, if the claim involves something outside your scope, or if the insurer decides to settle without your consent. And as noted, it rarely covers license defense.
According to the National Practitioner Data Bank, 26% of medical malpractice payments from 2012 to 2022 were made against non-physicians—nurses, therapists, techs, and others. That's more than a quarter of all payments. If you're a physical therapist, the average occupational therapy malpractice lawsuit totals $60,299 per HPSO data. That number alone should make you think twice about going bare.
What to Do Immediately
- Do not talk to the patient or their attorney. Politely refer all inquiries to your insurer or personal attorney.
- Do not alter or destroy records. That can be interpreted as spoliation of evidence and can ruin your defense.
- Contact your malpractice carrier. Most policies require prompt notice of any incident that could lead to a claim. Even if you're not sure, call them. It's better to report early.
- Document everything. Write down your recollection of the patient encounter, including dates, conversations, and clinical decisions. Keep a copy in a secure place.
- Consider your own policy. If you don't have one, now is the time to explore options. Even if you're not facing a claim yet, having coverage before an incident is the only way to guarantee protection.
Should You Contact Your Insurer Before You're Sued?
Yes. Absolutely. Most policies require you to report circumstances that could reasonably lead to a claim. If you wait until you're served with a lawsuit, you may have violated the policy terms. Plus, early reporting gives the insurer a chance to investigate and potentially resolve the issue before it escalates.
For example, in a real case shared by Berxi, a physical therapist had a patient who experienced pain and popping in her knee during a session. The patient later said she believed the therapy caused the injury. The PT reported the incident to Berxi immediately, even though no lawsuit had been filed. That proactive step helped protect him and his business.
How Your Own Policy Changes Your Options
Having your own malpractice insurance gives you control. You choose the carrier, the coverage limits, and the type of policy—occurrence or claims-made. With an occurrence policy (offered by CM&F Group, CPH & Associates, and HPSO), you're covered for any incident that happened while the policy was active, even if the claim is filed years later. No need to buy tail coverage.
With a claims-made policy (common with Berxi and Proliability), you're covered only if the policy is active when the claim is filed. If you leave that job or cancel the policy, you'll need tail coverage, which can cost 1.5 to 2 times your annual premium. Some carriers, like Berxi, offer both occurrence and claims-made, so you can choose what fits your situation.
Your own policy also includes critical extras: license defense, HIPAA fines coverage (up to $50k with Proliability), reputation coverage (Berxi), and the right to consent to settlement. Employer policies often let the insurer settle without your input, which can affect your reputation and future employment.
How Much Does Coverage Cost?
Prices vary by profession, state, and coverage limits. Here are typical annual ranges (not exact quotes—final pricing comes from the carrier):
- Registered Nurse (RN): $100–$150
- Nurse Practitioner (NP): $990–$2,000 (Proliability lists ~$991 employed, ~$1,190 self-employed; Berxi $1M/$3M ~$1,400)
- Therapist/Counselor: Berxi ~$363/yr supplemental, ~$765/yr primary
- Physical/Occupational Therapist: $100–$350
- Dental Hygienist: $45–$150
- Massage Therapist: BBI from $96/yr, ABMP $199/yr, AMTA $235/yr
- Esthetician: BBI from $9.99/mo (~$120/yr)
- Notary Public E&O: $20–$100
- CRNA: $1,500–$3,000
For most professionals, the cost is a fraction of what you'd pay for a single hour of legal defense. Check our profession-specific guides for more details: NP, RN, therapist, physical therapist, and others.
The Bottom Line
The early signs of a malpractice claim are often subtle. A records request, a subpoena, a demand letter, or a board complaint. Don't wait until you're sued to get coverage. By then, it's too late—no policy will cover a known incident. If you already have a policy, report any potential claim immediately. If you don't, get a quote today. It's one of the best investments you can make in your career.
Caveat: This article provides general guidance. Insurance laws and policy terms vary by state and carrier. Always read your policy and consult with a licensed agent or attorney for specific advice.