Get ready for everyone’s favorite answer: It depends.
Truthfully, the answer to this question could easily differ depending on what type of Ohio umbrella insurance you’re discussing (personal vs. business), as well as variations within the business policy itself.
In this post, we’ll discuss both personal umbrella insurance and business umbrella insurance, and whether either cover medical malpractice. We’ll start with personal umbrella insurance first.
Does personal umbrella insurance cover medical malpractice?
In reviewing several of our companies insurance contracts, one thing becomes very clear: the answer is an overwhelming no. In fact, this exclusion states it very clearly……
What we do not cover- Exclusions…..
……..personal injury or property damage arising out of the rendering or failing to render professional services.
According to the American Board of Professional Liability Attorneys, “medical malpractice occurs when a hospital, doctor or other health care professional, through a negligent act or omission, causes an injury to a patient. The negligence might be the result of errors in diagnosis, treatment, aftercare or health management.”
I think most of us can agree that doctors, hospitals, etc. are in the business of rendering professional services. So the failing to render such services would fall within the scope of the above exclusion.
Another way to think about is this: personal insurance policies are designed to cover personal exposures, which includes personal liability. Personal policies exclude business liability. Period. The reason is simple: business policies exist to address business exposures.
So to get business liability businesses will purchase a business liability policy (also referred to as a Commercial General Liability policy) and a business umbrella policy. The business umbrella is part two of our discussion.
Does business umbrella insurance cover medical malpractice?
It’s important to note here that just like a personal umbrella insurance policy that exists to pay for a bodily injury or property damage that EXCEEDS the underlying policy(ies), business umbrella insurance works the same.
So to get coverage that pays for medical malpractice, you first need to get a medical malpractice policy, as most business liability (commercial general liability) policies exclude professional liability.
Next you would need to purchase a business umbrella that ALSO pays for medical malpractice (your off-the-shelf business umbrella also excludes most professional liability). The business umbrella policy may be available with the same company that writes the medical malpractice OR it could be with a different company altogether. That varies by insurance company.
The moral of the story
The takeaway here is that you should never look to a personal umbrella insurance policy for coverage for medical malpractice. A medical malpractice policy is the first policy you need to buy, THEN look to a business umbrella policy next. And remember, not just any business umbrella will do- you need one that includes coverage for professional liability and/or medical malpractice.