Self-Insurance Coverage - Physician Contract Glossary

Self-Insurance Coverage

Definition

When an employer assumes financial responsibility for malpractice claims instead of purchasing traditional malpractice insurance.

Examples in Context

“The Employer maintains a self-insured trust fund to manage all professional liability claims arising from the Physician's clinical duties.”

“Malpractice claims will be covered under the Employer's self-insured coverage plan, subject to internal claims procedures.”

Implications for Physicians

• Your employer has direct control over claim defense and settlement decisions.
• Potential conflicts of interest if the employer's financial interests conflict with your defense strategy.
• Uncertainty about tail coverage options when employment ends.

Negotiation Tips

• Request proof of adequate financial reserves for malpractice claims.
• Ask for a clear process on how claims are reviewed, defended, and settled.
• Confirm if tail coverage is included or requires a separate purchase.

Red Flags and Pitfalls

• Employer fails to disclose claim management procedures.
• Insufficient reserves that may jeopardize your legal protection.
• Employer refuses to provide documentation on financial stability of the self-insured plan.

Related Terms

• Professional Liability Insurance
• Indemnification
• Tail Insurance

FAQs

• “What is the main risk with self-insurance coverage?”
  • Employers may prioritize limiting costs over defending your reputation, potentially affecting claim outcomes.
• “How can I ensure claims are handled fairly?”
  • Request written policies on claims handling, settlement procedures, and independent legal representation options.
• “Is tail coverage included in self-insurance?”
  • Often not. Confirm whether you need to purchase separate tail coverage when leaving your employer.