Why occupational therapists need liability insurance
Occupational therapists make clinical decisions that affect patient safety and recovery, which creates real liability risk. Claims can arise from falls during transfer training, assistive-device misuse, documentation errors, or failure to supervise a patient during an activity. According to HPSO, the average total cost of a malpractice lawsuit against an OT is $60,299 — a strong reason not to rely solely on employer coverage that may leave gaps.
Employer policies typically protect the facility first and often exclude license defense, which can cost thousands out-of-pocket. A personal policy covers you directly, includes license defense reimbursement (up to $25,000 with HPSO), and is portable — it stays with you across jobs, moves, and second jobs. Coverage also includes telehealth, as long as it's within your scope of practice and state law.
How much does OT malpractice insurance cost?
Annual premiums for occupational therapists generally fall between $100 and $350, depending on coverage limits, policy form, and your work setting. For example, HPSO offers limits up to $1M per claim / $3M aggregate on an occurrence basis. CM&F provides up to $1M/$6M portable coverage with license defense included. Berxi offers both occurrence and claims-made options with defense costs outside the limits and a $0 deductible. CPH & Associates also writes occurrence policies with unlimited defense attorney fees and State Licensing Board Defense up to $35k. Final pricing comes from the carrier at quote — these ranges are industry estimates.
What to look for in a policy
- Policy form: Occurrence is generally preferred for OTs because it covers incidents that happened during the policy period, even if a claim is filed later — no tail coverage needed. Claims-made policies require tail coverage (often 1.5–2x annual premium) if you leave the carrier.
- License defense: Choose a policy that covers legal fees for licensing board complaints. HPSO includes up to $25,000; CPH offers $35,000.
- Coverage limits: Most OTs opt for $1M per claim / $3M aggregate. Higher limits may be needed for private practice or high-risk settings.
- Portability: Make sure coverage follows you if you change jobs, work per diem, or do telehealth.
For more details on specific carriers, see our carrier comparison hub. Also check our guides on how much coverage you need and whether employer insurance is enough.
For occupational therapists, occurrence policies are the standard choice. They cover incidents that happened while the policy was active, regardless of when a claim is filed — no need to buy tail coverage when you leave a job or retire. Claims-made policies are cheaper initially but require tail coverage (typically 1.5–2 times the annual premium) if you switch carriers or stop practicing. Most major OT insurers — HPSO, CPH, and CM&F — offer occurrence forms.