Key Takeaways

• General liability insurance doesn’t protect a dental practice from every type of liability, including many cyber-related losses.
• Cybersecurity and cyber insurance serve different purposes, and practices may need both.
• Employee benefits and disability coverage can help practices protect and retain valuable team members.
• Business interruption, overhead and key person coverage can help protect the practice when the unexpected happens.
• Practice owners should evaluate coverage based on their actual risks, not just premiums.

Insurance is one of those things most dental practice owners hope they never need to use. But when something does go wrong, discovering that the coverage you assumed you had isn’t actually there can turn an already difficult situation into a much bigger financial problem.

On a recent episode of Beyond Bitewings, recorded live at the Southwest Dental Conference, Ash spoke with Herb Ford of Brown & Brown, formerly Wallace Specialty, about some of the insurance misunderstandings he sees among dental practice owners. Their conversation covered everything from cyberattacks and umbrella policies to employee benefits, disability, business interruption, and professional liability.

The larger message was straightforward: having insurance isn’t the same thing as being adequately protected.

Know What Your Policies Actually Cover

General liability insurance is a good example. Most dental practices carry it, and landlords and lenders commonly require it. But the word “general” can make the coverage sound much broader than it really is.

A general liability policy doesn’t necessarily protect a practice against a cyberattack, employment-related lawsuit or professional liability claim. Those risks may require separate coverage.

Cyber risk is particularly important because dental practices hold significant amounts of sensitive patient and financial information. Ash shared the example of a client whose point-of-sale system was hacked. The practice owner assumed either his general liability policy or IT provider would protect him, only to discover after the incident that neither provided the financial protection he expected.

Cybersecurity and cyber insurance also aren’t interchangeable. Cybersecurity is designed to help prevent attacks and limit the damage when one occurs. Cyber insurance can address financial consequences afterward, which may include patient notification, credit monitoring, legal expenses and business interruption.

Umbrella insurance can create similar confusion. An umbrella policy provides additional liability coverage after the limits of certain underlying policies have been exhausted. It doesn’t automatically increase every type of insurance you carry. For example, a commercial umbrella generally won’t make up a shortfall in the amount of property coverage on your practice.

Personal umbrella coverage can also be worth discussing with an insurance professional, particularly for dentists who have accumulated significant personal assets or have additional liability risks, such as teenage drivers.

The important question isn’t simply, “Do I have insurance?” It’s, “What would this policy actually protect me from if something happened?”

Protecting Your People and Your Practice

Insurance can also play a role in one of the biggest challenges dental practices face: attracting and keeping good employees.

When considering employee benefits, Herb recommends first understanding what employees actually want and how many are likely to participate. Health insurance may be part of the conversation, but practices can also consider group life, dental, vision, short-term disability and long-term disability coverage.

Short-term disability, for example, can provide income to an employee who is temporarily unable to work after an injury or illness. That can be particularly valuable for hygienists, dental assistants and other employees whose ability to work depends heavily on their physical health.

Benefits can also support retention. Dental practices depend on people and the relationships they develop with patients. Recruiting and training replacements is expensive, and frequent turnover can affect the patient experience. A thoughtful benefits package can therefore become part of a broader strategy for keeping good employees.

Practice owners should also think about what happens when the person who can’t work is the owner or another essential member of the practice.

Business overhead expense coverage may help pay expenses such as rent, utilities and payroll if a covered disability prevents an owner from working. Other types of coverage can help with shorter-term interruptions or protect the practice if a key employee becomes disabled or dies.

That raises an important business continuity question: What happens to the practice if one of the people it depends on most suddenly isn’t there?

Preparing for the Risks You Don’t Expect

Professional liability is another area where practice owners can have gaps without realizing it. Individual dentists and associates typically carry their own malpractice insurance, but if a patient files a lawsuit, the practice entity itself can also be named.

Even when the owner wasn’t involved in the treatment, the practice may incur legal expenses defending itself. Entity-level professional liability coverage and appropriate protection related to associate providers can help address that exposure.

Property damage presents another risk. A fire, flood or other covered event can leave a practice unable to see patients for weeks. Business interruption coverage may help replace income lost during that period, while extra expense coverage may help with the cost of temporarily operating elsewhere.

Employee theft is another area worth reviewing. Some business policies include coverage, but the limits may be relatively low compared with the amount that can disappear before fraud is discovered.

Across all of these examples, one point came up repeatedly: don’t evaluate insurance based on price alone. Comparing your premium with what another dentist pays tells you very little if the two practices don’t have the same coverage, limits, equipment, providers or risks.

Instead, periodically look at what could create a serious financial disruption for your practice and determine whether your current insurance program addresses those risks.

Because the worst time to find out what your insurance doesn’t cover is after you need it.

Listen to or watch the full episode of Beyond Bitewings for the complete conversation.