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Changing Employers? Keep Your Tail Covered!

A common question regarding employment, and particularly changes in employment, revolves around the idea of tail insurance coverage.  As such, this issue’s legal column explores what tail coverage is, why you need it, and who pays for it.

In general, there are two types of medical malpractice insurance policies: (1) claims made policies and (2) occurrence policies.  If an advanced practice nurse (“APN”) has a “claims made policy,” this means that the insurance will cover any claims that are made against the APN while that policy is in effect.  However, it will not cover claims that are made after the policy is terminated (i.e. the APN moves to a new practice or the practice changes carriers).  Anyone with a “claims made” policy should purchase a “tail” policy to be effective once the original policy ends.  The tail policy will extend insurance coverage for a set amount of time in order to protect the APN against lawsuits that may be brought at a later date even though the original policy is no longer in effect.  This tail should be purchased regardless of specialty.  In general, it is best to negotiate who is responsible for purchasing the tail before entering into an employment agreement.  Otherwise, the APN will likely hold full responsibility for purchasing the tail, unless his/her new employer will purchase it or a severance package can be negotiated with the former employer that includes tail coverage.

If an APN has an “occurrence policy,” this means that the insurance will cover any claims made against the APN for incidents that occurred while the policy was in place.  (A lawsuit will still be covered after the policy ends, so long as the actual incident at issue occurred while the policy was in effect.)  In this case, there is no need to purchase a tail policy, because the occurrence policy will continue to protect the APN for incidents that happened while the policy was in place.  This type of policy is becoming rare.  Most places now carry a “claims made” policy, but there are a few “occurrence policies” still used.

SHORT ANSWER:  Anyone coming off of a “claims made policy” should purchase a tail.

STRATEGIC TIP:  It is best to negotiate who will buy the tail during employment contract negotiations before employment even commences.  There are many ways this can be structured.

Article by Jeana M. Singleton taken from the OAAPN Newsletter Challenge, September 2009

BMD Congratulates Tony Manna and Signet Capital Advisors - 2018 ACG Deal of the Year

BMD Congratulates Tony Manna and Signet Capital Advisors - 2018 ACG Deal of the Year

BMD Making a Real Impact through the Bridges Program

When the State of Ohio announced the Bridges Program in early 2018, it was an opportunity for real change - it was a commitment to change the narrative for young adults in the foster care system. The program is designed to help young adults aging out of the foster care system prepare for adulthood. BMD has been at the forefront of this initiative providing legal support for the program.

BMD 2019 OHIO SUPER LAWYERS AND OHIO RISING STARS

BRENNAN, MANNA & DIAMOND is proud to announce RICHARD W. BURKE (Estate Planning and Probate), ROBERT A. HAGER (Construction Litigation), MICHAEL A. STEEL (Bankruptcy, Business) and RICHARD L. WILLIGER (Workers’ Compensation, Employment & Labor) have been selected as 2019 Ohio Super Lawyers by Law and Politics magazine, Northern Ohio Live magazine, and Cincinnati Magazine in their respective area of practice. BMD’s 2019 Rising Stars include: JUSTIN M. ALABURDA (Business Litigation), VICTORIA L. FERRISE (Government Relations), ALEX J. McCALLION (Business Litigation), BRANDON T. PAULEY (Business/Corporate) and DANIEL J. RUDARY (Business Litigation)

Family and Friends Remember Brennan Manna Diamond co-Founder

At 6 fee 6 inches and wearing a white cowboy hat, Brennan Manna Diamond co-founder David L. Brennan was known for rescuing failing businesses and blighted areas and initiating and shepherding Ohio's school choice movement.

Amanda Waesch Weighs in on Leasing v. Buying Medical Office Space

Amanda Waesch weighs in on leasing v. buying medical office space