What to Know About Nurse Practitioner Malpractice Insurance

Are you searching for nurse practitioner malpractice insurance but aren’t sure how to pick the right plan for you (or what you need in the first place)? We’ve got you covered—literally!

While you probably pursued nursing to help others and make a difference, one part of the job to keep in mind is how to protect yourself, too. Throughout your career as an NP, there may come a time when there isn’t a positive outcome, and you or other members of the healthcare team may be held accountable.

Although it isn’t the most fun topic to discuss, it’s definitely an important one! In this post, we’ll talk about everything you need to know about nurse practitioner malpractice insurance and how to choose the right coverage. Let’s get started!

What is malpractice insurance?

Just like other types of insurance (e.g. health insurance, car insurance, homeowner’s insurance), malpractice insurance is there just in case something goes wrong.

Malpractice insurance is also known as professional liability insurance, which helps explain its purpose. It helps cover the costs of claims related to medical malpractice and negligence.

These include the cost of damages in the claim (how much money the plaintiff could potentially be awarded), lawyer fees (including the cost to prepare your case and defend you in court), and license protection in the form of representation to your state board of nursing (if applicable).

Why is it important to have malpractice insurance as an NP?

So, malpractice insurance covers a lot! But why do NPs need it?

First, most states require NPs to carry malpractice insurance, and it could even be included in your contract by your employer. But the bottom line is: always make sure you’re covered by malpractice insurance.

The scope of practice and ability to practice independently is frequently changing for NPs. They can diagnose, prescribe medications, order treatments, and help coordinate overall care.

It doesn’t take an obvious mistake or oversight to cause a malpractice claim. A small complaint or negative outcome can lead to costly litigation. You need to make sure you have the ability to mount a sufficient defense and have someone in your corner with your best interests in mind. Being without malpractice insurance could be devastating, both monetarily and career-wise.

Do you need to get malpractice insurance as an NP student?

I think we’ve made it pretty clear so far that as a practicing NP, you definitely need to have malpractice insurance. But what if you are in school as an NP student?

You may carry your own insurance as an RN, but that will not cover you as an NP student because you’re acting in a different capacity. Also, your NP program may also provide basic malpractice coverage for you as a student, but that coverage may not be comprehensive enough for all types of claims.

As an NP student, there are few more factors involved in malpractice since the clinical facility assumes some responsibility for you while you are there, plus the oversight of the NP program.

Are you covered by your preceptor’s malpractice insurance, since you’re practicing under their supervision?

No. While your preceptor should be supervising you and appropriately delegating tasks, you as an NP student may still be held liable in a malpractice suit. NP students are held accountable to the scope of a nurse practitioner in the clinical setting.

📣 The bottom line is (once again): always make sure you’re covered by malpractice insurance. Several professional liability companies have coverage policies for NP students!

What does nurse practitioner malpractice insurance cost?

This question is a bit more difficult to answer. The cost of malpractice insurance depends on a few factors, including coverage limit (how much money your insurance will cover in fees and damages), your specialty area, state of practice, how often you practice (whether full or part-time), and how long you have been practicing as an NP.

You can expect most policies to range from about $600-$2000+ per year. While that is a significant cost, it is nothing compared to the cost of not being covered and being named in a malpractice suit.

What should you consider before getting malpractice insurance?

Now that we’ve convinced you of the importance of malpractice insurance as a real deal NP, what do you need to consider in the policy?

Claims-made vs. occurrence-based

Claims-made policies only cover incidents that are claimed during the period that the policy is active.

Occurrence-based policies cover incidents that occur during the policy period.

Example: Let’s say you had a policy with an employer that was active from 2020 to 2022. It’s now 2024 and you find out that a malpractice claim from an incident in 2021 has been filed.

If you had a claims-made policy, you will not be covered because that policy is no longer active. If you had an occurrence-based policy, you are covered since the claim is based on an incident during the policy period.

Employer-based vs. individual policies

Don’t skim over the fine print! Many policies offered by employers are claims-made policies, which can leave you unprotected for claims that may occur after employment ends.

Also, employer-offered policies may not include protection for lost wages and additional attorney fees. Even if your employer provides malpractice coverage, you should definitely consider carrying your own personal policy to cover any gaps and make sure you have additional personal advocates in your corner.

Don’t forget the tail coverage!

If your employer provides malpractice coverage using a claims-made policy, ask about tail coverage. You can purchase protection for a certain period of time that extends the policy after you leave that employer.

But how long should you get tail coverage for? Review your state’s particular statute of limitations on filing malpractice claims to help with that decision.

How much coverage do you need?

Get as much coverage as you can afford! But if you’re looking for specifics, most experts would recommend $1,000,000 / $6,000,000 policies. That means coverage of $1,000,000 per occurrence with a limit of $6,000,000 aggregate (or the total amount the insurance company will cover during a policy period).

It sounds like a lot of money, but legal fees quickly add up and if there is a payout to occur, those can reach up into the hundreds of thousands of dollars. 

Do different NP specialties need different kinds of malpractice insurance?

When applying for malpractice insurance, you will be asked questions about your specialty and clinical practice. Some NP specialties or clinical practice types (such as mental health and women’s health/obstetrics) carry a higher risk of malpractice.

Therefore, the insurance company may adjust your policy and premium to provide better coverage for potential claims. Also, consult with your state board of nursing to inquire about any other specifics for malpractice insurance based on your specialty and clinical practice. 

Final Thoughts

Purchasing nurse practitioner malpractice insurance (a.k.a. professional liability insurance), is a big decision to make, but a necessary one. You might not want to think about the possibility of having a malpractice claim made against you or a healthcare team you worked with, but that reality is it’s a very real possibility. Having malpractice insurance, especially your own policy, ensures that you will have the coverage and help you need when you need it most.

Good luck on your NP journey, and we hope this post helped you stay protected throughout your career! 💜

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For more FREE resources to help you navigate professional practice as an NP, check out these other posts on the SMNP Reviews blog:

• Continuing Education (CE) Credits for NPs: What You Need to Know
• All About Incident To Billing Guidelines for Nurse Practitioners
• What Are Your NP License Renewal Requirements?