The “what if” question every psychologist asks

The “what if” question every psychologist asks

It’s only natural to ask ourselves “what if…?”, we do it almost every day. What if I said the wrong thing? What if I went back to school? What if we move to another city or state? The list goes on and on. As a psychologist, you undoubtedly have asked yourself “what if a client files a malpractice claim against me?”.

The truth is, very few professionals, including psychologists, have the financial resources to defend a malpractice claim on their own. Legal costs alone could total tens of thousands of dollars and the outcome could cost more than money; it could impact a professional’s reputation, business, clientele, etc. That’s why many people get professional liability insurance and, just like so many things, it doesn’t come in a ‘one size fits all’ package.

There are two types of professional liability policies: occurrence and claims-made. I know you’re busy, and probably juggling three or four things (more like 20) right now so we’ll stick to the basics for this article. The difference between the two types can be boiled down, in part, to timing.

An occurrence policy provides coverage for future claims of alleged incidents that took place during the policy year whether or not your policy is currently active. For example, let’s say you had a policy from 2000 to 2010. If a claim is filed against you this year, and the alleged incident date is between 2000 and 2010, you’re covered with an occurrence policy.

On the other hand, claims-made policies only cover claims that occur and are filed while the policy is active. Again, let’s say you had coverage from 2000 to 2010. If a claim is filed against you this year for something that allegedly happened during the policy term, you’re not covered… unless you purchase a tail. It’s called a tail because the coverage follows you after the policy is terminated and provides protection for any future claims filed with incident dates during the active policy term.

That’s the major difference between the two types of professional liability insurance in a nutshell. Of course, there are many more details which you can find on The Trust’s website on the Frequently Asked Questions page: HERE.

Understanding the two types of professional liability insurance will enable you to make an informed decision. If you need help or have questions, visit our website,, or call 1-800-477-1200 to speak with one of our licensed insurance specialists.

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