IS a type of professional liability insurance that protects professionals—most commonly doctors, nurses, lawyers, therapists, accountants, and other licensed practitioners—if a client or patient claims they were harmed by negligence, errors, omissions, or failure to meet professional standards.

In healthcare, it’s often called medical malpractice insurance.

What malpractice insurance covers

Coverage depends on the profession and policy, but it typically includes:

1. Legal defense costs

Pays for attorneys, court fees, expert witnesses, investigations, and settlements or judgments if you’re sued.

2. Claims of negligence or mistakes

Examples:

• A doctor allegedly misdiagnoses a condition
• A surgeon makes an error during surgery
• A lawyer misses a filing deadline
• A therapist is accused of improper treatment

3. Settlements and court awards

If the insured loses a case or settles out of court, the insurer may pay damages up to the policy limits.

4. Licensing board or disciplinary proceedings

Some policies help cover legal expenses tied to professional board investigations.

5. HIPAA/privacy or documentation issues (healthcare policies)

Certain policies include limited cyber/privacy protections or records-related defense costs.

What it usually does

not

cover

Most policies exclude:

• Intentional wrongdoing or criminal acts
• Fraud
• Sexual misconduct
• Practicing outside your licensed scope
• General business disputes
• Employee injuries (covered by workers’ comp)
• Property damage unrelated to professional services

Types of malpractice insurance

Claims-made policy

• Covers claims filed while the policy is active
• Most common and usually cheaper initially
• May require tail coverage when leaving a job or retiring

Occurrence policy

• Covers incidents that happened during the policy period, even if the lawsuit is filed years later
• More expensive but broader long-term protection

How much malpractice insurance costs

Costs vary enormously based on:

• Profession and specialty
• State/location
• Claims history
• Coverage limits
• Years of experience
• Whether you work full-time or part-time

Profession	Typical Cost Range
Family physician	$5,000-$15,000
Surgeon (high-risk specialties)	$30,000-$200,000+
Nurse practitioner	$8000-$13,000
Registered nurse	$1000- $5000
Dentist	$1,000-“$10,000
Lawyer	$1000-$5,000+
Therapist/counselor	$500-$2,500

Common coverage limits

Healthcare policies often use limits like:

• $1 million per claim
• $3 million annual aggregate

That means:

• Up to $1M for one lawsuit
• Up to $3M total during the policy year