• Facebook
  • Youtube
  • Instagram
  • LinkedIn
Call us now: (602) 344 9865
Chelle Law
  • Home
  • Medical Contract Attorney
    • Dentist Contract Attorney
      • Dental Associate Employment Contracts 
        • Can a Dental Associate Break Their Contract?
        • How a Dentist Should Negotiate a Contract
        • How is a Dentist Given a Draw in a Contract?
        • Red Flags in a Dentist Employment Contract
        • What Should a Dentist put in a Termination Letter?
      • Dental Malpractice Insurance
        • Claims Made Insurance for a Dental Associate Explained
        • How Much Does Tail Insurance Cost for a Dentist?
        • Occurrence Based Insurance for a Dental Associate Explained
        • Should a Dentist Choose Claims Made or Occurrence Insurance?
        • What is Tail Insurance for a Dentist?
      • Dental Non Compete Clause
        • Dental Associate Non Compete vs Non Solicit
        • Dental Non Compete Mile Radius Explained
        • Dental Non Compete Time Limits Explained
        • Dentist Non Compete Restricted Offices Explained
        • Is a Non Compete Enforceable Against a Dentist?
      • Dental Contract Benefits 
        • Does a Dentist Have to Repay a Bonus if they Terminate the Contract?
        • How Much PTO Should a Dental Associate Get?
        • How Much Should a Dentist get for CE Expenses?
        • Should a Dentist be Reimbursed for Moving Expenses?
        • What Expenses Should a Dental Practice Pay For a Dentist?
      • Dental Independent Contractor Agreements
        • Are Dentists Usually Self Employed?
        • Dentist Independent Contractor Tax Deductions
        • Dentist Independent Contractor vs Employee
        • Is a W2 or 1099 Better for a Dental Associate?
        • What is a 1099 Dentist?
    • Nurse Practitioner Contract Attorney
      • Nurse Practitioner Employment Contracts
        • Can a Nurse Practitioner Break Their Contract?
        • How a Nurse Practitioner Should Negotiate a Contract
        • Red Flags in a Nurse Practitioner Employment Contract
        • What is the Most Common Nurse Practitioner Compensation Model?
        • What Needs to go in a Nurse Practitioner Termination Letter?
      • Nurse Practitioner Malpractice Insurance
        • Claims Made Insurance for a Nurse Practitioner Explained
        • How Much Does Tail Insurance Cost for a Nurse Practitioner?
        • Occurrence Based Insurance for a Nurse Practitioner Explained
        • Should a Nurse Practitioner Choose Claims Made or Occurrence?
        • Tail Insurance for a Nurse Practitioner Explained
      • Nurse Practitioner Non Compete Clauses
        • How Many Locations Should a Nurse Practitioner Non Compete Apply To?
        • Is 10 Miles a Reasonable Non Compete for a Nurse Practitioner?
        • Is a 2 Year Non Compete for a Nurse Practitioner Reasonable?
        • Is a Non Compete Enforceable Against a Nurse Practitioner?
        • Nurse Practitioner Non Compete vs Non Solicit
      • Nurse Practitioner Contract Benefits
        • Does a Nurse Practitioner Repay a Bonus if the Contract is Terminated?
        • How Much Paid Time Off Should a Nurse Practitioner Get?
        • Should a Nurse Practitioner be Reimbursed for Moving Expenses?
        • What Benefits Should be in a Nurse Practitioner Offer Letter?
        • What Nurse Practitioner Expenses Should an Employer Pay For?
      • Nurse Practitioner Independent Contract Agreements
        • Is a W2 or 1099 Better for a Nurse Practitioner?
        • Nurse Practitioner Independent Contractor Tax Deductions
        • Nurse Practitioner Independent Contractor vs Employee
        • Nurse Practitioner Self Employed vs Independent Contractor
        • What is a 1099 Nurse Practitioner?
    • Optometrist Contract Attorney
    • Physician Contract Attorney
      • Medical Employment Contracts
        • J-1
          • ECFMG Eligibility
        • How Many Years Should the Term of a Physician Contract Be?
        • Should a Physician Accept an Arbitration Clause?
        • What Is the Best Without Cause Termination Length in a Physician Contract?
      • Medical Malpractice Insurance
        • What Is Claims-Made Insurance For a Physician?
        • What Is Occurrence Insurance for a Physician?
        • Should a Physician Choose Claims-Made or Occurrence Malpractice Insurance?
        • What Is Tail Coverage for Physician Malpractice Insurance?
        • When Does a Physician Need to Pay for Tail Insurance?
        • How Much Does Tail Insurance Cost for a Physician?
        • 3 ways a physician can get out of paying for tail insurance
      • Non-Compete Agreements
        • Is 10 Miles a Reasonable Restriction in a Physician Non-Compete?
        • Is a 2-Year Physician Non-Compete Too Long?
        • How Many Locations Should a Physician Non-Compete Apply to?
        • Is a Non-Compete Enforceable Against a Physician?
      • Medical Professional Contract Benefits
        • How Much Should an Employer Give a Physician for CME Expenses?
        • What Physician Business Expenses Should an Employer Pay for?
        • How Much PTO Should a Physician Get?
        • Should A Physician Receive Relocation Reimbursement When Moving for a New Job?
        • Does a Physician Have to Repay a Sign-On Bonus When They Leave?
        • Does A Physician Have to Repay Relocation Assistance If They Leave?
      • Independent Contractor Agreements
        • Can a Physician be an Independent Contractor?
        • Physician Independent Contractor vs Employee
        • Is a W2 or 1099 Better for a Physician?
        • What is a 1099 Physician?
        • What Percentage of Physicians are Self Employed?
    • Physician Assistant Contract Attorney
      • Physician Assistant Employment Contracts
        • Can a Physician Assistant Break Their Contract?
        • How a Physician Assistant Should Negotiate a Contract
        • Red Flags in a Physician Assistant Employment Contract?
        • What is the Most Common Physician Assistant Compensation Model?
        • What Should Go Into a Physician Assistant Termination Letter?
      • Physician Assistant Malpractice Insurance
        • How Much Does Tail Insurance Cost for a Physician Assistant?
        • Should a Physician Assistant Choose Claims Made or Occurrence Insurance?
        • Tail Insurance for a Physician Assistant Explained
        • What is Claims Made Insurance for a Physician Assistant?
        • What is Occurrence Based Insurance for a Physician Assistant?
      • Physician Assistant Non Compete Clauses
        • How Many Locations Should a Physician Assistant Non Compete Apply To?
        • Is 10 Miles a Reasonable Non Compete for a Physician Assistant?
        • Is a 2 Year Non Compete for a Physician Assistant Reasonable?
        • Is a Non Compete Enforceable Against a Physician Assistant?
        • Physician Assistant Non Compete vs Non Solicit
      • Physician Assistant Contract Benefits
        • Does a Physician Assistant Repay a Bonus if the Contract is Terminated?
        • Should a Physician Assistant be Reimbursed for Moving Expenses?
        • What Benefits Should Go In a Physician Assistant Offer Letter?
        • What Physician Assistant Expenses Should an Employer Pay For?
      • Physician Assistant Independent Contractor Agreements
        • Can a Physician Assistant be Self Employed?
        • Is a W2 or 1099 Better for a Physician Assistant?
        • Physician Assistant Independent Contractor Tax Deductions
        • Physician Assistant Independent Contractor vs Employee
        • What is a 1099 Physician Assistant?
    • Veterinarian Contract Attorney
      • Veterinary Associate Employment Contracts
        • Can You Break a Veterinary Associate Contract?
        • How is a Veterinarian Given a Draw in a Contract?
        • How to Negotiate a Veterinary Associate Contract
        • Red Flags in a Veterinary Associate Contract
        • What Should be in a Veterinary Associate Termination Letter?
      • Veterinary Malpractice Insurance
        • What is AVMA Excess Limit Coverage?
        • What is AVMA Veterinary License Defense Insurance?
        • What is Occurrence Insurance for a Veterinarian?
        • What is the AVMA PLIT?
        • Why Veterinarians Do Not Need Tail Insurance
      • Veterinary Non Compete Agreements
        • How Many Locations Should a Veterinary Non Compete Apply To?
        • Is a Non Compete Enforceable Against a Veterinarian?
        • Veterinarian Non Solicit vs Non Compete
        • Veterinary Non Compete Mile Radius Explained
        • Veterinary Non Compete Time Limits Explained
      • Veterinary Professional Contract Benefits
        • How Much PTO Should a Veterinary Associate Get?
        • How Much Should a Veterinarian get for CME Expenses?
        • Must a Veterinarian Repay a Bonus if They Terminate the Contract?
        • Should a Veterinarian be Reimbursed for Moving Expenses?
        • What Veterinarian Business Expenses Should an Employer Pay For?
      • Veterinary Independent Contractor Agreements
        • Pros and Cons of Employment at a Corporate Veterinary Office
        • Should a Veterinarian be a W2 or a 1099?
        • Veterinarian Independent Contractor Tax Deductions
        • Veterinary Independent Contractor vs Employee
        • What is a 1099 Veterinarian?
  • Our Attorneys
    • Robert S. Chelle, Esq.
    • Renee Osipov, Esq.
    • Erin Howlett, Esq.
  • Results
  • Contact Us
  • Search
  • Menu Menu

Occurrence Based Insurance for a Dental Associate Explained: Different From Claims Made for Dentists

What is occurrence-based malpractice insurance for a dentist?  If you are just coming out of training and just graduated from dental school, you probably haven’t had to think about dental malpractice insurance before, but when you sign your new employment contract, there’s going to be language about who pays for the underlying coverage and then potentially must pay for coverage after the contract terminates. There are two common types of malpractice insurance for dentists. You have occurrence-based coverage and claims-made coverage. Let’s kind of go through both of those and then we’ll talk a little more in-depth about occurrence-based coverage. A claims-made policy simply means a policy must be in effect when the claim is made.

Occurrence Coverage for Dentists Who Need Insurance

A dentist could terminate the contract, leave an employer, and then if it’s a claims-made policy, it ends when they leave the employer, then there’s going to be a gap in between when they leave and then the last day they can be sued. In most states, it’s around two years. There are some exceptions. For instance, if some minors become an adult and there are others in different states but let’s just take two years kind of like a common amount. If you leave the employer and someone can sue you for two years, then you need a policy that covers the gap between those two dates, and that is called tail insurance. Now, who must pay for tail? Well, that’s going to be dictated by the terms of the employment agreement. It’s going to state most likely that the employer is going to pay for the underlying coverage, meaning, they’ll pay the annual premium, so how much it costs to cover the dentist on a year-to-year basis.

And then after the contract is terminated, who pays for tail insurance? It will state specifically in the contract. If it doesn’t, it needs to. Tail insurance is generally around twice what the annual premium is to cover the dentists. Whatever they must pay on a yearly basis, you just multiply that times two, and that’s kind of a good estimate as far as how much the dentist would have to pay for tail if they had to pay for it. It’s a one-time cost, so you don’t have to pay on a year-to-year basis. And a tail length can change depending upon how much coverage the dentist wants. It could be one year, two years, five years, or could be unlimited. That’s a little more expensive the more coverage you have. I would suggest just getting the longest amount of coverage.

Just getting a one-year tail, even though statute limitations on a claim is two years, puts the dentist at risk and it just doesn’t make sense for it’ll probably be the difference between a few hundred dollars makes zero sense not to go for the longer coverage. That’s claims-made insurance. Now, claims made is the most common type of malpractice insurance used by dental practices. However, some use what’s called occurrence-based coverage and in occurrence-based coverage, there has to be a policy in effect when the incident occurs. If there is an occurrence-based policy, then obviously, the incident is going to occur while the dentist is employed with the practice, and no tail insurance is necessary. So, you do not have to worry about any claims after the employment relationship ends if you have an occurrence-based policy.

Now, you’re probably thinking, alright, well, why would one choose occurrence versus claims made? Obviously, occurrence is better if you don’t have to purchase tail. Yes, that’s true, it’s just more expensive. An occurrence-based policy generally costs about a third more than a claims-made policy. So, just from the perspective of a dental practice, they would prefer to pay a third less per year for the malpractice insurance. Additionally, they would put the onus on the dentist to pay for tail and they save a bunch of money rather than having to pay a third more per year for an occurrence coverage and then no tail expense on the end as well. So, if you have the choice, there’s no reason not to go with the occurrence coverage if the employer is paying for it. Most employers are not going to leave it up to the dentist as far as which policy to choose.

They’re just going to have a policy and then all the providers in the practice will use the same policy. But let’s say maybe you’re an independent contractor and whoever you’re working for says, it’s up to you. Well, you need to do a kind of math equation. Let’s just say your insurance cost is 3000 per year. If you had an occurrence-based policy and let’s, just say for claims made, it was 3000 a year. Occurrence is a third more, so that would be 4,000 total for occurrence. Whereas claims made is 3000 plus usually a 6,000 tail. So, if you’re going to stay with an employer for one year, it makes sense to pay the 4,000 for occurrence-based coverage versus 3000 for a policy plus 6,000 for a tail. That’s a $5,000 difference. If you’re going to stay with an employer for a very long time, claims made might make more sense.

You just must do the math and shop for the policies and just see the price differences between the two. Dental malpractice insurance is not prohibitively expensive. Obviously, some of the subspecialties in surgery and things like that, it’s going to be more, but for the most part, dental malpractice is reasonable.

Tail Cost if You Have Claims Made Insurance

How much does tail insurance cost for a dentist? First, let’s talk about when you would need tail insurance, and then we’ll talk about how much it costs. There are two common medical malpractice policies for dentists, and that’s either occurrence-based or claims made. Under an occurrence-based policy, you need a policy in place when the incident occurs. Tail insurance is not necessary. Under a claims-made policy, a policy has to be in effect when the claim is actually made. It’s possible you terminate a contract, you leave an employer, but there’s still going to be a statute of limitation. A period that somebody could sue you from malpractice and in most states, it’s two years.

There are exceptions, but I’ll just say for these purposes, it’s two years. Tail insurance would be a policy that covers the gap between when you leave an employer and then the last day that somebody can sue you. Most places require tail policy to be at least two years at most. In the employment contract, it’s going to state who is responsible for tail insurance if you have a claims-made policy. If it doesn’t say that, then you need to figure it out and make sure that language is inserted before signing the agreement. In the agreement, it will have a section that states that the employer will provide the underlying annual premium, it’s how much it costs to insure you on a yearly basis. And then usually, it will state what type of policy that they utilize, and if it is a claims-made policy, who’s responsible to pay for tail insurance.

Most of the time, the dental practices will put the burden to pay the tail insurance on the dentist who is leaving the practice. The reason why they would use one policy over another, occurrence-based policy is generally about a third more expensive than claims made. And if the employer uses a claims-made policy, which is a third cheaper and puts the onus on the dentist to pay the tail insurance costs, they’re saving a decent amount over the course of an employment relationship between them and a dentist. So, if you are responsible to pay for tail insurance, how much does it cost? Well, a good rule of thumb is it’s about twice what your annual premium is. As I said before, the annual premium is how much it costs to insure you on a yearly basis.

And you just multiply that times two, and that will be how much you must pay for tail. It’s a one-time payment, so you don’t have to pay tail insurance every single year. It’s a one-time payment, and then you’re covered for however long a policy that you decided to go with. I would suggest if they had, and they will have, kind of an unlimited tail policy, which will just cover you indefinitely. That’s the way to go. As I said before, there are some exceptions and then there are some longer statute limitations based upon what state you’re in. And so, it would be a bad idea to get a policy that didn’t cover the entire amount. If you get sued and there is no insurance to cover you, you may be personally reliable for those damages if it gets to that point and then you’ll have to pay for your own attorney and go through that.

And then the settlement will come out of your own personal funds. So, it just makes sense to pony up by the indefinite tail, and that way, you’re covered. How much it costs kind of varies based upon specialty. If you’re just doing general dentistry, it’s going to be a little bit less, and if you’re maybe an endodontist or doing some more surgical procedures, it would be more expensive. But I guess what I would consider a reasonable amount for insurance is somewhere between 2,000 to 4,000 for an annual premium, that would not be uncommon for a general dentist. And so, your tail costs would be somewhere between 48,000 in that scenario. Not a prohibitive amount of money, but still an amount that you’re most likely going to pay for and essentially a budget that you’re going to pay for that amount.

And then, it has to be paid prior to the termination of the contract. So, before the contract is terminated, you would have to purchase that policy. And then the employer would require you to provide proof that you had purchased that policy. That’s how much tail insurance costs. 

Which Coverage Should You Choose for a Dental Practice

Should a dentist choose occurrence-based or claims-made coverage?  First, occurrence and claims made are the two most common types of malpractice insurance for dentists. And if you are an employed dentist with the practice, it’s very likely that the practice is going to use claims made. Let’s kind of go through the differences between the two and then maybe which one would benefit you. If you are thinking of signing an employment contract, there’s going to be a section in the contract that discusses malpractice insurance. If you’re an employee, the employer absolutely should pay for your underlying premium. An underlying premium is just simply how much it costs to insure you on a yearly basis.

They should pay for that. Now, if it’s a claims-made policy, it means a policy has to be in effect when the claim is actually made. It’s possible you could leave an employer and then there’s going to be what’s called a statute of limitation. It’s a period that someone can sue you. In most states, it’s two years, but there are exceptions. There are a few states that are a little longer than that, but let’s just use two years as an example here. If you had a claims-made policy, you would need tail insurance, which then covers the gap between when you leave and then the last day somebody can sue you. A claims-made policy versus an occurrence policy is really kind of the differentiator’s price. With an occurrence-based policy, you don’t need tail insurance but it’s about a third more expensive than a claims-made policy.

Under a claims-made policy, it would be a third cheaper than an occurrence-based policy. However, you would be responsible to pay for tail insurance. And a good rule of thumb is tail insurance costs about twice what your annual premium is. Let’s just say an annual premium of $4,000. Then if you’re responsible to pay for tail, it would be around $8,000. Now, that’s a one-time cost, it’s not yearly. And you would pay that prior to the expiration of the contract, or if it’s been terminated on your last day of work. And you’d have to pay the entire amount upfront but then you would be covered for however long. The tail costs can vary a little bit based upon two things: one, how long you’ve been with an employer, and then two, the length of the tail.

So, it can be anywhere from 1.5 times your annual premium, all the way up to three times based upon those factors. It’s honestly rare that you would have an employer say to you, we can offer you both policies, we can do occurrence-based, or claims made, it’s up to you. Well, if it’s up to you, then obviously, you should get an occurrence-based policy so as not to have to worry about tail insurance, it’s a no-brainer. If they say to you, we’ll pay for whatever underlying annual premium it is, and it’s up to you, then get an occurrence-based policy. Now, maybe you’re an independent contractor and whoever you’re going to work with states, you’re responsible to pay for the annual premium, and if you get claims made tail, that would be a scenario where you would kind of have to decide.

Insurers for Associates

Think of it this way: if you are working for someone as an independent contractor, and let’s just say you’re only going to work for one year and you can choose between either policy. Well, in that scenario, it would make sense to get an occurrence-based policy. Let’s just say you have a, as I said before, $4,000 annual premium. Well, at the claims made level, it’s a third more, so you’d be paying roughly $5,300 per year with an occurrence-based policy, wherein if you had a $4,000 claim-made policy and then the contract ends, and it’s twice as much, then you have to pay 4,000 for the annual premium, plus 8,000 for the tail, maybe a little bit less than that. So, you have a $12,000 total cost if you went with claims made, and if you’re only staying with an employer for one year. And then if you had an occurrence-based policy, you’re only paying 5,300.

So, you’re saving roughly $6,700 just by utilizing an occurrence-based policy. That scenario, once again, makes complete sense. Now, if you’re staying with an employer for a long period, or as an independent contractor, working for someone for a long period, let’s just say it’s 10 years. Well, in that scenario, you would have to do the math of, alright, if I’m paying a third more per year over the course of 10 years, is that going to be more expensive than having a policy that’s a third cheaper and then tacking on $8,000 at the end? The longer the timeframe you’re with an employer, the more it probably makes sense to go with a claims-made policy if you had the choice. Now, expecting to work an extended period like 5, or 10 years with one practice is full heartedly in my opinion. I mean, with the kind of proliferation of all these corporate dental practices swooping in and buying up all these dentist-owned practices, places that we’re great to work with before are now maybe not so great to work at, or with, and so I would not go into any kind of relationship expecting it to last more than 5 to 10 years.

It’s just very unlikely in this environment that that would happen. So, that’s a breakdown of occurrence versus claims made, and then maybe which one you should choose if you’re looking for a new position.

Employment Contract Questions?

Contract Review, Termination Issues, and more!

For More Information >

Call Us Now: 602.344.9865

Contact Us

If you are in need of assistance or would like to hear more about the services we offer contact Chelle Law today!

Links of Interest

  • Home
  • Dentist Contract Lawyer
    • Dental Associate Employment Contracts 
    • Dental Malpractice Insurance
    • Dental Non Compete Clause
    • Dental Professional Contract Benefits 
    • Dental Independent Contractor Agreements
Google
Based on 121 reviews.
Melinda Striyle
Melinda Striyle
2022-06-12
Attentive, respectful, great to work with.
Jenn Lighthall
Jenn Lighthall
2022-06-10
Absolutely fantastic. I would give more than five stars if I could. Highly recommend!
Meghna C.
Meghna C.
2022-05-31
Renee was great to work with when negotiating my contract! I am a resident physician signing on for my first attending job, and I felt more comfortable with the language used in the contract after going over it with Renee. I also got a higher starting salary which made the price more than worth it. I would definitely use Chelle Law again!
Jennifer Nevis
Jennifer Nevis
2022-05-30
Erin Howlett saved me from a terrible situation and I can't thank her enough. I had accepted a veterinary dental residency in northern Illinois with a private practice. The letter of intent was routine yet the actual contract so punitive and predatory in nature that it was hard to believe it was from the same people. Erin believed I was worth more than the "Zero" this practice claimed. Without her on my side, I would have naively signed this "bait and switch" and been finacially and professionally ruined if I couldn't complete the 6 year commitment this practice demanded.
robin singh
robin singh
2022-05-27
I consulted with Chelle law for contract review. They were suggested by our employer. Renee osipov was incredibly helpful and was able to navigate me in right direction. I fully recommend them.
Melanie Schlote
Melanie Schlote
2022-05-22
Erin was so professional and very quick to respond. She took the stress away from contract reviewing and made me feel confident in this next step of my career.
Mitul Patel
Mitul Patel
2022-05-22
I contacted Chelle Law for my dental contract review. I am very pleased with contact review with Attorney Renee. Renee was very kind, helpful, honest, informative and knowledgeable. She had some solid advice regarding negotiations. Katie was very helpful to schedule appointment with Renee within few days. I had some questions next day and emailed her and she responded back to me within an hour. I HIGHLY RECOMMEND CHELLE LAW FOR YOUR CONTRACT REVIEW. THANK YOU!!
Anna Etzler
Anna Etzler
2022-05-20
Renee was wonderful to work with and helped me with a contract review for my first NP job. She took the time to help me understand each section of the contract and even helped me successfully negotiate so that the contract would best fit my needs. Chelle Law was very responsive to my needs and set up my initial review and revision review in a timely manner! I would highly recommend their services to anyone in the medical profession.
Alan W
Alan W
2022-05-16
Had the privilege of working with their attorney Renee. She was really thorough, professional, and went above and beyond in reviewing my contract. Couldn't have asked for a better experience.

Call Us Today!

602.344.9865

Hours/Office

Monday-Friday: 8:00am-5:00pm (MST/MDT)

Chelle Law 5425 E. Bell Rd, Ste 107

Scottsdale, AZ 85254

Contact Us Today!

5425 E. Bell Rd, Ste 107, Scottsdale, AZ 85254

info@chellelaw.com

Practice Areas

  • Professional Licensing Board Defense
  • Medical Contract Lawyer
  • Administrative Appeals & Hearings
  • Medical Contract Drafting
  • Fingerprint Card Attorney

Office Locations

  • Arizona
  • Indiana

Company

  • Robert S. Chelle, Esq. Founder & CEO
  • Sara Stark, Esq. Attorney
  • Renee Osipov, Esq. Attorney
  • Erin Howlett, Esq. Attorney
  • Charlie Hover, Esq. Attorney

Resources

  • Blog
  • Contact Us

Follow Us

© 2022 Chelle Law. All rights reserved.  Disclaimer & Terms of Use.  Privacy Policy.

Scroll to top

How Much PTO Should a Physician Get Download



How Much PTO Should a Physician Get?

4 Factors to Consider with PTO

How Much Does Tail Insurance Cost Download

How Much Does Tail Insurance Cost for a Physician?

4 Key Aspects of Tail Insurance for Physicians

Physician Contract Review Checklist

Where Should We Send the Physician Contract Checklist?

28 Essential Physician Contract Terms to Put You in a Positive Financial Situation for Years to Come.