What is the AVMA PLIT? | Veterinary PLIT with the AVMA

What is the AVMA PLIT? The AVMA is the American Veterinary Medical Association and the PLIT is their Professional Liability Insurance Trust. The PLIT is kind of the branch of the AVMA that offers a bunch of different types of insurance for veterinarians. The most important one would be their professional liability insurance, also known as malpractice, where a vet can pay a relatively small fee per year compared to other healthcare professions. And then if any malpractice suits were filed against them, they would be covered under the policy and then would be provided legal counsel. Let’s just kind of go through some of the insurance I guess, opportunities that the AVMA offers through their trust, and then maybe which ones make more sense than others to purchase.

Veterinary Professional Liability Insurance

First, they have professional liability insurance, as I just mentioned, it’s an occurrence-based policy, and that means that a policy simply has to be in effect when the malpractice occurs. There is another type of insurance called claims made where a healthcare provider would need to purchase tail insurance after the employment ends, but for a vet, almost everyone goes through the AVMA for the malpractice insurance, just because it’s so affordable. And under that policy it is occurrence-based. And so, no tail is necessary. They also offer veterinary license defense, and this is something I would implore any vet to make certain that they purchase. If you’re a veterinary associate and you’re an employee of a practice, the employer should absolutely pay for your annual premium. The annual premium is just simply how much it costs to insure you on a yearly basis.

And then the AVMA also offers veterinary license defense for an additional fee. Now, malpractice insurance for vets is, as I said before, extremely affordable. Like a small vet exclusive or a small animal exclusive vet with 1 million, 3 million. So, 1 million per claim, 3 million aggregate per year would be like $250 per year. And then if you wanted to add on professional licensing board defense, it’s like $50 extra to add that per year. And if someone did file a complaint against you with your licensing board, most vets or at least many of them want to retain attorneys to represent them before the board. And if you had this licensing defense kind of writer on your malpractice policy, they would then provide you with an attorney who would represent you before the board.

If you were to pay a normal licensing board defense attorney would depend upon the severity of the case, but it could be anywhere between $5000 to $10,000, which most vets are not interested in paying for. Whereas if you were just to pay 50 to a hundred dollars per year, you would be covered if any board complaints happen. There may be some small deductible, I guess I need to investigate that a little bit more, but it certainly is worth it. That’s something to keep in mind. If your employer is going to pay for the malpractice policy which they should, then you would want them to pay for the board defense as well. And if they say, no, we’re not going to pay for it, then just spend the extremely small amount of money.

Veterinary Insurance Options

Just so you can have peace of mind if a board complaint happens. Most vets absolutely do not expect a board complaint to be filed. As a licensing board attorney who also does employment contracts for vets, I can tell you, it happens a lot more frequently than you would expect. Usually, it’s a ticked off client whose animal died for whatever reason. And they are looking for someone to blame and the vet is the absolute target that they go after. Many of the complaints have absolutely no merit at all. However, if the documentation was poor or if they did something that occurred, the vet could be disciplined in some manner by the board which most professionals want to avoid if possible.

They can also offer personals, they offer homeowners auto, identity theft, and excess liability. They have a kind of full-service line of insurance. Now, whether those are worth going after versus using like an insurance agent that you know, I can’t tell you, but they do have kind of a full line of coverage. They also offer business stuff, so workers comp, business property and liability, kind of employment practices, which is normally like retaliation, sexual misconduct, that type of thing. And then auto, umbrella liability, a whole bunch of things. But if you’re just like a veterinary associate, really the ones that are most important to you are just the malpractice and then the licensing board defense. So, that’s what the AVMA PLIT is. I would consider it rare amongst the professions. Most professions it’s spread out like for a physician, there are hundreds of insurance companies and there is no giant company that everyone goes with.

AVMA PLIT Liability Costs 

And same can be said for PAs, and NPS, whereas with the vets, it really is like a monopoly for the professional liability insurance, but it’s just so affordable when you offer so much coverage and you have so many different clients that use you, that it’s just kind of a no brainer for a vet. Now, there are other options. It’s not like you only have one option. But for most people, because it’s exceedingly rare for a vet to be sued for malpractice, it just makes sense to go with the lowest cost option.

What is Veterinarian Malpractice Insurance? 

Veterinarian malpractice insurance is a policy that covers the liability that a veterinarian has if something should go wrong with a client’s pet that leads to the pet’s death or prolonged injury. Such incidents can happen even in the most well-run veterinary practices in the world, and even if everything was done strictly by all best practice procedures. This is why most vets are well-aware that they need coverage to keep themselves protected.

Protection Coverage is Available Through Professional Organizations

The Humane Society Veterinary Medical Association (HSVMA) partners with an insurance provider known as Safehold Special Risk to offer veterinarians malpractice coverage to keep themselves financially protected. The program offers the following coverage:

• Professional liability: $1 million per occurrence/$3 million annual aggregate 
• License Defense: $100,000 annually 
• Animal Bailee: $50,000 per occurrence

This is a significant amount of coverage because the claims brought against a veterinarian and their practice can be substantial. Pet owners who are distraught over the loss of their beloved pet may seek vengeance against the practice that they feel did the damage. With that in mind, the size of the lawsuit that they attempt to bring against a veterinarian may also be quite large. In some cases, lawyers are willing to advocate for pet owners who try to do this. Thus, it is a good idea to have significant malpractice insurance coverage to keep yourself protected. 

Veterinary Occurrence-Based Malpractice Insurance

What is occurrence-based insurance for a veterinarian? This is malpractice insurance. There are two common types of malpractice insurance. You have occurrence-based and claims made. But most veterinarians get their professional liability insurance through the AVMA PLIT. And that policy is an occurrence-based policy. What does that mean? An occurrence-based policy simply means a policy must be in effect when the malpractice incident occurs. With the claims-made policy, it has to be in effect when the claim is actually made. A vet could leave an employer, but then someone could sue them after the fact, let’s say a year later. And so, if that were to happen, they would need what’s called a tail policy that covers the gap in between when they leave the employer and then when the statute of limitations runs, which is just kind of how long someone can sue you for something.

Occurrence-Based Policy Cost

And then after that date, they can no longer sue you for that. But as I said before, the AVMA offers an occurrence-based policy, which means essentially the vet is covered indefinitely for anything that happened while they were working for that employer. As far as the cost of malpractice insurance for a veterinarian, it’s extremely inexpensive compared to other healthcare professions. Just as an example, a policy with 1 million, 3 million limits, meaning 1 million per occurrence and then 3 million aggregate per year for. Let’s just say a small animal exclusive vet is $248. Extremely cost effective compared to most others. Just as an example, let’s just say you have a general surgeon physician, their malpractice per year could be 15,000. Whereas a vet in this situation is 250. The most expensive liability insurance for veterinarians is equine exclusive. And that could be what the same policy limits around 2,600 per year. So, a significant almost tenfold increase from small animal to equine. And it’s all based upon damages. Obviously, damages to a cat versus damages to a horse could be significantly different. Now, it’s rare for someone to sue a veterinarian for malpractice.

Most of the time it’s just simply not worth the time of the plaintiff’s attorney. Any time, someone decides to sue someone else for malpractice, obviously, they need an attorney to assist them with that. And then when an attorney is deciding whether they take a case or not because almost all plaintiff’s malpractice cases are taken on a contingency basis, meaning the attorney only gets the money if they are successful in the lawsuit. And the damages are so small for most animals that it’s just not worth the time of the attorney, to be honest. However, if you had a horse and maybe a racehorse or performance horse where they could generate a lot of income and then something would happen to that, there could be a significant amount of damage and it makes a little more sense to pursue an action like that.

And that’s why the insurance for them is 10 times more expensive than for small animals. Now, if you are a vet, your employer should cover your annual premium. Your annual premium is just simply how much it costs to insure you on an annual basis. And that is not a cost that you should have to undertake. Maybe if you’re an independent contractor, it would make sense for you to pay the expenses associated with your malpractice insurance. However, if you’re working for an employer, they should pay for your underlying policy, that’s just kind of a standard benefit. And essentially it is so affordable. There’s really no argument that an employer can make that the vet should be the one to cover those costs. It just doesn’t make sense. And especially because tail insurance is not needed for a vet if they’re going through AMVA. Sometimes that’s a cost that is passed through to the provider once the contract terminates, but in this situation that just simply is not something that occurs.

So, that’s occurrence-based insurance for a veterinarian. Once again, it’s honestly a relatively small thing that would be negotiated in a contract because tail is not necessary because the employer almost always covers it. It’s better for the vet to focus on other things, I guess that’s the best way of saying it. One other tip: the AVMA also offers professional liability defense for an extremely small fee. It’s like $50 more per year. And if someone were to file a board complaint against you, you would automatically be provided legal counsel at no cost to the vet unless there may be a deductible that they would be responsible for.

So, I would suggest if you are going to get malpractice insurance, which you will, that you ask the employer to pay for the extra policy that will cover any kind of board defense, and if they’re not willing to pay for it, obviously, spend the 50 bucks or a hundred dollars or whatever it is, so that you’re covered for a board defense. To hire a licensing board defense attorney, I guess depending upon the severity of the case, can be anywhere between $5,000 to $10,000. And it’s just well worth the little amount per year to cover that.

Settlements for Malpractice Insurance Cases are Common, but Not Always Desired

Insurance companies are often quick to try to settle a case outside of the court system. They do so because they usually do not want to put forth the time and effort necessary to actually see a case through. The costs are higher for an insurance company when a case goes to trial, and the insurance company always wants to save as much money as it possibly can. Thus, the insurance company may take actions that are not in the best interest of their clients. That is what you need to pay particular attention to when signing up for a malpractice policy. 

Veterinarians who believe that they followed every procedure as precisely as they should have may want to reach out to a veterinarian employment contract lawyer to receive additional counsel about steps that they can take next. The reason for this is that they may have a legitimate case worth fighting for in court. If they immediately give up because that is what their insurance company wants, then they may do serious reputational damage to themselves. 

Consultation with Chelle Law

When your veterinary contract is analyzed by an experienced attorney, you will find financial benefits which end up outweighing the cost of the review. Leave it to the experts. If you are in need of assistance with a veterinary agreement or contract analysis schedule a Veterinarian Agreement Review with Chelle Law today!