What NASW Members Are Telling Us at State Chapter Conferences About Their Insurance Gaps
Discussions with NASW members at state chapter conferences have yielded some important pearls of wisdom that must be shared with you. The feedback that we receive most frequently arises from insurance gaps that boomerang on the social workers costing them a lot of money. Thus far, the most frequent concerns and coverage gaps voiced to us by NASW members arise from perceived employer coverage, general liability issues, records control issues, and coverage lapses (intentional or not).
The May Tip of the Month: “PITFALLS??? Does Your Employer Cover YOU?”, addresses the employer coverage concern that many practitioners have voiced at their conferences. In a nutshell, employers cannot be counted on to shield you from liability. The majority of the NASW members we speak with are aware of this employer coverage gap. The overwhelming majority buy their own professional liability policy from the NASW Risk Retention Group because it is the best coverage and at the best price. Justification is simple because a typical professional liability policy costs about $55 to $200 annually, which is less that one hour of paid attorney time to defend you which averages $375 per hour.
Regarding general liability insurance, there is one particular case that an NASW member told us about and that we need to share with you. General liability incidents are a common occurrence in the liability insurance industry claims category.
In this case, social worker “M” approached our conference booth at the annual New Jersey NASW chapter conference recently, and related a sad story. “M” bought a professional liability policy from “ABC” company, not the NASW Risk Retention Group. She was told by the “ABC” insurance agency sales person over the phone that the policy covered both her professional liability perils and her general liability perils. Soon afterward, a delivery person twisted his ankle in M‘s office on the small area carpet in front of the reception desk. A demand letter was sent to ”M” for damages sustained by the delivery person which was to precede the lawsuit against “M”.
Prior to progressing into an expensive lawsuit, “M” settled the incident with a generous payment to the delivery person out of her own pocket because her insurance carrier denied the claim and legal defense coverage. The reason for claim denial was that the policy “M” bought was not a real general liability policy. It was merely a professional liability policy that included a small narrowly defined coverage that only responds in the slim event that the client slipped and fell during the time at which “Professional Services” as defined in the policy contract that was being delivered to that client only.
If the client slipped and fell on the way to the bathroom, or the client’s companion or parent slipped and fell in the waiting room, that peril incident would be denied as a claim under the ABC policy. A slip and fall by a delivery person is even further removed from a client relationship and “Professional Services” rendered. A real general liability policy like the NASW Risk Retention Group’s general liability policy would have covered this claim.
Regarding patient records and third-party breach, we have found that many practitioners are still unaware of the HIPAA risks. Specifically, in 2013, Congress added third-party breach liability to HIPAA, as HIPAA HITECH 45 CFR Part 160. This law holds social workers liable for any third party data breach. Violation of this law has civil penalties up to $25,000 for accidental breach by the social worker’s records management company provider, or even a mover hired to relocate the social worker’s office files. Criminal penalties range up to 10 years in jail and $250,000 in fines.
We have learned that some practitioners have lapsed their NASW Risk Retention Group General Liability and/or their Risk Retention Group cyber liability policies. Professional liability coverage is always top of mind with practitioners because it is required for employment and in most states for licensure. It is also first in line for “share of wallet”.
Some practitioners say that they simply forgot to renew their general liability and/or cyber liability policies. Other practitioners say since they have had no claims in these categories that they want to save the annual $59 premium for cyber coverage, and/or save the annual $154 premium for general liability coverage. They are willing to simply take the chance that a claim will not be filed against them. That is a very poor gamble. The high cost of legal defense fees and other claims costs are back-breaking compared to the overwhelmingly low premiums paid for the coverage and such huge peace of mind.
Here are critical metrics that practitioners need to know before they lapse or terminate their insurance coverage:
- 3 practitioners out of 100 will sustain a claim against them, and that claim will average $3,800.
You are taking a great risk if your insurance policy lapses.
The NASW Risk Retention Group insurance products are supported by a staff of over 375-panel lawyers across the nation who are experienced in defending healthcare related incidents, claims, and lawsuits. We have a robust Helpline for NASW Risk Retention Group policyholders that provides immediate assistance. Our valuable and nationally recognized claims adjudication resource is expert at defending you as follows:
- 96% of NASW Risk Retention Group claims incidents are resolved before they fester into a claim, and the policyholder pays nothing.
- 42% of the claims that do occur are closed with no costs to the NASW Risk Retention Group, and of course, the policyholder pays nothing.
The insurance licensed professional staff at NASW Assurance Services will help you solve your insurance needs. The NASW endorsed NASW Risk Retention Group insurance plans are made for social workers and fully vetted and overseen by social workers. They are A.M. Best “Excellent” insurance rated and backed by Lloyd’s London and SwissRe, the two largest reinsurers in the world.
You have Peace of Mind. None of the other competitors’ liability insurance policies offer as low a premium, nor cover the wide variety of perils that the NASW Risk Retention Group’s liability insurance suite covers.
Published June 2018