Each Physician, Clinic Option, and Partnership/Corporation coverage policy includes features designed to maximize your protection. The following is an overview of some of the benefits.
ISMIE policies are written on a claims-made basis. Claims-made protection is liability insurance that provides coverage for any claims or suits resulting from professional services rendered on or after the first date of your coverage (known as the retroactive date). Under ISMIE’s claims-made policy, the claim or suit must occur and be reported during the time your policy is in effect. Coverage ceases with termination of the policy; therefore, any claim or suit reported on or after policy termination is not covered. (For exceptions: see Reporting Endorsements/Tail Coverage and Prior Acts Coverage.)
An inherent advantage of ISMIE’s claims-made coverage is that each year you pay for protection against claims reported during that year and only that year. In your first year of claims-made coverage, your premium will be lower to reflect the low probability of any claim occurring and being reported during the first year of claims-made coverage. In the second year of claims-made coverage, your premium will be somewhat higher, taking into consideration claims that occur and are reported in your second year, as well as claims that may have occurred in your first year but are reported in your second year. As a result, premium levels increase each year until a "mature" level is reached at seven years, at which time premiums tend to stabilize, reflecting the leveling off of the cost and number of claims reported.
Occurrence coverage has won renewed interest among many medical professionals, including physicians new to practice, those rethinking hospital employment and doctors considering new practice models that simply don’t require prior acts coverage. One thing to keep in mind for current ISMIE policyholders – switching from claims-made coverage to occurrence will require you to fund any previous claims-made exposure. Not to worry -- ISMIE is offering convenient options to ease your way.
Claims-Made or Occurrence Coverage by ISMIE: A Primer
ISMIE now offers policyholders a choice of medical liability coverage based on a claims-made or occurrence model.
If you’re a current ISMIE policyholder or considering joining us, here’s how both types of coverage work:
*Claims-made policies cover professional services rendered on or after the policy retroactive date which result in a claim, as long as such claim is reported during the policy period when the policy is still active. Medical professionals with claims-made coverage commonly need to secure prior acts or “tail” coverage when the policy expires.
*Occurrence policies cover professional services rendered during the policy period, no matter when a claim is reported -- even after the policy expires. This eliminates a professional’s need to purchase prior acts or tail coverage for protection against claims made after the policy expires.
Transfer-to-Occurrence (TTM) provides insureds with a claims-made policy to shift to an occurrence-based policy for an additional premium in lieu of purchasing tail coverage. As mentioned above, occurrence-based policies do not require purchase of coverage when the policy is cancelled because coverage applies to claims for services rendered when the policy was in force even if a claim is reported after the policy is cancelled, in accordance with all the terms of the policy. Please contact the underwriting division for further details on ISMIE’s TTO product.
Physicians of all practice specialties and at all stages in their practice careers have opportunities for rate discounts with ISMIE. In fact, each year 70 percent or more of ISMIE policyholders qualify for a Loss-Free Discount, based on their exceptional risk management practices. If you have demonstrated loss-free experience and have been loss-free (have not incurred a paid loss) for at least three consecutive years, then you are entitled to receive a discount on your premium. Discounts range from 3 percent to 19.5 percent depending on the number of consecutive loss-free years. Unlike other insurance carriers who may discontinue such a discount as soon as a claim has been filed, ISMIE does not believe in penalizing its policyholders simply because a claim has occurred.
Newly Practicing Physician Coverage
At ISMIE, we know that beginning a practice is often as frustrating and costly as it is exciting. We understand the special needs of the newly practicing physician. To help you get started, we offer reduced rates to physicians who enter a practice for the first time, or who enter a new specialty after completing medical training. Special, discounted rates are available for your first four full years of practice if you are insured with ISMIE from the start of your new practice.
Absolute Consent to Settle
At ISMIE, a policyholder's written consent is prepared before any claim settlement is made on his or her behalf.
ISMIE Mutual’s policy territory is the United States of America, its territories or possessions, except for where a Patient’s Compensation Fund or similar program exists, and only if such claim is pursued in the United States of America, its territories or possessions.
Limits of Liability
ISMIE offers you several options for professional liability policy coverage limits. As of this writing, the following policy limits are available:
- $1,000,000 "each person"/$3,000,000 "aggregate"
- $2,000,000 "each person"/$4,000,000 "aggregate"
"Each person" is defined as the maximum amount payable for all injuries caused by patient care and treatment to any one patient. "Aggregate" is the total amount of indemnity the policy will pay for all claims or suits reported during the policy period.
When determining the level of coverage that is appropriate for your practice, it is critical to take into account the risks of your specialty, the current level of malpractice awards and settlements, patient population served and hospital and insurance company requirements. Although every physician may not need the highest coverage limits, low limit policies may threaten your personal financial well-being and the defensibility of a claim because it may not be feasible to take a case to trial with low limits.
Prior Acts Coverage
Prior Acts coverage, also known as "nose" coverage, allows physicians who meet certain underwriting criteria to join ISMIE without purchasing a reporting endorsement (tail) from your previous insurer.
Prior Acts coverage protects you for any patient treatment rendered under a previous policy with another insurer that is reported as a claim or suit after that policy terminates. In fact, Prior Acts coverage with ISMIE is typically less expensive than tail coverage through your previous insurer.
Flexible Tail Coverage
A Reporting Endorsement, commonly known as “tail” coverage, is available at the termination of your professional liability policy. To be protected under tail coverage, the claim or suit must result from professional services rendered on or after the retroactive date, but before the policy termination date.
Tail coverage is a one-time purchase, which you must request in writing within thirty days of termination or non-renewal of your policy. ISMIE uses tail factors that apply to expiring annual premium, rather than to mature annual premium. The premium can be paid via a three-year installment plan, if desired. Specific rates for reporting endorsements are not included in our standard rate charts because various underwriting criteria may affect your particular tail premium. For specific tail rates for your policy, please call our underwriting division at 800-782-4767, fax 312-782-2023 or email firstname.lastname@example.org.
Free Retirement Tail Coverage
We will offer free retirement tail coverage to any physician at any age as long as he or she has been insured with ISMIE for 10 consecutive years. We will also offer free retirement tail coverage to physicians who have been insured with ISMIE for a minimum of five consecutive years and who are at least age 55.
Illinois Policyholders Only:
Purchase a Single Limit Reporting Endorsement (tail coverage) with an extended reporting period of one to six years, or an indefinite extended reporting period (note: all extended reporting period options include a single policy limit of liability that does not renew, does not include supplementary payments, and excludes all coverage and payment of defense costs for claims arising out of any conduct of a sexual nature).
Premium for all options is due in full within 50 days from the date the invoice is prepared and cannot be accepted if received after the due date.
Single Limit Reporting Endorsement available with the following extended reporting periods:
- One Year Extended Reporting Period
- Two Year Extended Reporting Period
- Three Year Extended Reporting Period
- Four Year Extended Reporting Period
- Five Year Extended Reporting Period
- Six Year Extended Reporting Period
- Indefinite Extended Reporting Period
Free Defense Reimbursement Coverage
Provides $500 per day up to 15 days each policy period for attending trials and depositions (other than your own).
Protect Yourself from Medicare/Medicaid Billing Errors
Did you know that ISMIE offers legal expense reimbursement because of an investigation by a government health benefit payor for Medicare and Medicaid billing errors? This benefit includes:
- Reimbursement for all legal expenses arising out of Medicare or Medicaid complex reviews due to alleged billing errors and omissions.
- Standard reimbursement of up to $30,000, per physician, per investigation, with a $1,000 deductible. The aggregate limit for Clinic Option policyholders with groups of five or more insureds may vary.
Legal Expense Reimbursement
Your medical license is key to your ability to practice your profession. When your state’s professional licensing board or agency begins an investigation against you, the consequences can be frightening. To help you when the unimaginable occurs, ISMIE offers reimbursement for legal expenses incurred because of a licensing board/agency hearing or investigation. The maximum reimbursement which a physician may receive during any one policy period is $30,000 per physician for any one proceeding per policy period, with a $1,000 deductible.
Providing professional liability coverage at the fairest possible premium level is a primary goal at ISMIE. Your premium is determined by the coverage limits you select, the historical risk associated with your specialty, and the geographic location of your practice. Rates are reviewed annually. ISMIE's sound underwriting practices, strong record of aggressive defense of claims, and prudent investment of funds help us keep premiums to reasonable levels, yet ensure our financial integrity.
Review of Loss Trends
Each year, ISMIE searches for trends by studying loss-experience in the aggregate as well as by specialty and geographic territory. This process leads to the development of ISMIE overall rates for each program year. Based on substantiated trends over a minimum three-year period, we will make the necessary adjustments that may result in lower rate levels for certain specialties and territories (it can also result in higher premiums).
Your ISMIE policy covers a 12-month period. Premiums are typically billed in quarterly installments. You will receive your quarterly bill 30 days before the payment due date. Policyholders also have the option to pay the entire annual amount at once. Premium Financing options are available to policyholders at a special low interest rate with First Insurance Funding Corp., a solid premium financing enterprise.
We do not assess finance charges for late payments. However, premiums must be paid when due to assure uninterrupted coverage. If we do not receive your payment by the due date specified on your invoice, we will send you a warning notice. If we do not receive your payment within 13 days of the warning invoice date, your policy will be cancelled as of the cancellation date indicated on the warning invoice.
Our underwriting division is happy to assist you with questions about your bill. It is helpful if you have your policy number available when you call.