Liability Insurance For Therapist & Counselors: A 2023 Guide

TLTR: This article explores various kinds of therapy in relation to insurance needs, risks that may arise in the day-to-day job of a therapist, and the coverage involved. Some frequently asked questions are also answered.

“Success as a therapist is not found in doing something for the client but rather in being someone for the client.” — Ili Rivera Walter

The COVID-19 pandemic has led to a significant rise in stress and anxiety in the general population. An article by the KKF suggests that mental health issues in the U.S. have significantly risen. It’s no surprise that more people are seeking therapy than ever. But what does this mean for therapists?

With more people in therapy, many professionals are feeling overworked and burned out. Professional liability insurance for therapists is more crucial than ever in such a climate.

What Is Liability Insurance For Therapist?

Therapists can be faced with many ethical and legal conundrums over the course of their careers. They sometimes need to decide whether or not a patient is an imminent danger to themselves or someone else and whether the authorities need to be notified. If they misjudge the situation, it could result in serious injury or death. Therapists can also be vulnerable to accusations of inappropriate patient treatment or lack of proper patient treatment.
Therapy requires sound judgement as therapists must weigh multiple factors before deciding what course of intervention would best serve their patients’ needs. At the same time, they also need to protect themselves legally against any perceived mishaps which might occur in the course of treatment.

Liability insurance for therapists is similar to legal malpractice insurance. As a therapist, it’s one of the most important insurance policies you can invest in.

Liability insurance for physical therapists is equally important. Take the case of Walker v. Segura Jr., for example. As reported in the Cook Country Record, in the course of receiving therapy, a patient eventually sustained a fracture that required surgery. This led them to sue the physical therapy clinic.

Cases like this are not uncommon. This is why physical therapy liability insurance is necessary.

Who Needs It?

We should note that liability insurance is important for a wide range of therapists. These include:

• Addiction therapists
• Speech therapists
• Massage therapists
• Behavioral therapists
• Clinical therapists
• Child therapists
• Exercise therapists
• School therapists
• Trauma therapists
• Nutritional therapists

Risks That May Require Liability Insurance for Therapists

Liability insurance for therapists may crucial when there is:

Negligence

According to Statista, there were 491 addiction facilities that provide medicinal treatment in the U.S. as of 2019. For therapists working in such settings, there are significant chances of unintentional negligence. For example, you may accidentally prescribe a client a medication dosage which is a little excessive and leads to side effects.

Personal Injury

The work of physical therapists may be most relevant in this category. If a client is injured in one of your sessions, they can take legal action against you.

High Risk Patients

If you have patients who experience suicidal ideations or some form of severe mental health disorder, it’s especially important to invest in liability insurance. Sometimes, regardless of how much time you invest in a person struggling with clinical depression, you just can’t save their life. This a harsh reality of being a therapist.

Unfortunately, in such situations, the legal implications may be very difficult to navigate.

Misinterpretation

It’s possible for a patient to misunderstand your advice and follow what they think you said to their own detriment.
Misinterpretation with clients is not unheard of and it certainly isn’t either party’s fault. In such cases, liability insurance for a therapist can certainly come in handy.

Misguidance

According to a report on Statista, it’s not uncommon for physical therapists to work excessive hours when in residency. This kind of workload can lead to exhaustion, which can lead to errors and the unintentional misguiding of patients. A tired mind is not a sound mind for making decisions. In such cases, liability insurance for therapists is very important.

Time Killers

Therapists usually charge on an hourly basis. While this is beneficial for clients, there’s an unexpected element of risk involved. Rightly or wrongly, a client may believe the time isn’t being used to their full benefit. They might accuse the therapist of loafing or otherwise killing time in some way so they can get paid for doing less.

Situations such as these are the exceptions rather than the rule, but no matter how conscientious you may be as a therapist, a lawsuit is always a possibility.

What Are The Coverages Under Liability Insurance For A Therapist

As a health care professional, you must have heard of or even have some form of medical malpractice insurance. Liability insurance for therapists works similarly. Here are some areas that the policy will cover:

• Professional Liability Coverage
• License Protection
• Defendant Expense Benefit
• Deposition Representation
• Personal Liability Coverage
• Defense Attorney
• Assault Coverage
• Personal Injury Coverage
• Medical Payments
• Damage to Property of Others
• First Aid Expenses
• Sexual Misconduct
• Information Privacy Coverage

What Are Some Other Coverages That You Should Consider Having

General Liability Insurance

General liability insurance protects individuals and businesses from many of the errors that can occur. That includes third-party property damage, bodily injury, but also medical expenses and legal defense costs. If someone is injured on your property or you are sued for causing an accident to happen.

Cyber Liability Insurance

Can your patients book their treatment sessions online? Do you take credit card payment? Protecting sensitive information is a crucial part of running an office, from digital records to financial data. If the cyber world crosses into yours and you are subject to a data hack (data breach) or phishing scam, fines will be significant–and costly for business owners like yourself! Cyber liability insurance has proven its worth time after time in protecting vital company resources.

Worker’s Compensation Policy

If you have employees, workers compensation insurance is mandatory in many states. Some benefits are for the company and others make sure that your employee doesn’t suffer because they got injured on a job site. This can help cover the damages related to medical expenses, costs to cover their position if it becomes necessary while they recover from injury or illness, and paid leave during time off due to an accident at work as well as other reasons like family emergencies or education purposes.

Commercial Property or Renters Insurance

As a freelance therapist, you may need to invest in your own office space. If you own or rent your office space, it is important to have coverage for the natural disasters and accidental disasters that occur. In this case, commercial property insurance or renters insurance.

Commercial Auto Insurance

The commercial auto insurance policy is perfect for those who only use their vehicle when they’re working. This type of coverage can be added to personal car insurance, and it will help with the costs should you ever need an accident-related rental or tow truck.

How Much Does Liability Insurance For Therapists Cost

According to Insureon, liability insurance for therapists can cost less than $30 per month. This policy will provide protection for third-party liability (bodily injury and property damage) and advertising injury.

Here are some companies you can consider buying the policy from:

• AIG
• Pogo
• The Doctor’s Company
• Embroker
• Renegade Insurance
• Thimble Insurance
• Hiscox

Is It Important To Get Therapist Liability Insurance From Business Insurance Agents Near Me?

A therapist insurance agent falls under the category of business insurance agents and is licensed for the same. While you may feel that researching the right carriers and coverages by yourself would be best, professional insurance brokers can help you to make the process smooth and hassle-free.

Hiring an insurance broker will ensure you get the best liability insurance for counselors.

You can reduce expenses while focusing on your patient’s care with just the right coverage. In case you are faced with any liability charges, you can rest assured that your policy will cover them.

Trusted local agents you can count on will help you protect your practice and career. They can assist in making insurance claims which would otherwise create a giant hole in your bank account or even exceed what you may be able to afford.

Whether you are a new or seasoned counselor, make sure you get all coverages, including liability and therapist malpractice insurance.

Conclusion

Purchasing liability insurance for therapists is an investment in yourself, your family, and the people who are counting on you. Businesses and individuals these days cannot afford to have liability lawsuits. The reality of life includes lawsuits, battles with insurers, and bodily injury accidents that can really have devastating effects on individuals, their families, and their loved ones.

Purchasing liability insurance protects you from lawsuits filed as a result of any accidents stemming from your work or personal activities. The cost varies between $100 – $1 million depending on the size and needs of your business and coverage requirements set forth by state laws. If you are worried about covering costs if someone sues you for injury incurred at your place of business, it’s best to opt-in upfront rather than wait until something happens to purchase the policy.

If you have any more questions about this topic, feel free to get in touch with a local insurance agent or even our team–we’re happy to help! Who knows? You might even find some new coverage options when it comes time to renew your policy next year.