The Malpractice Coverage Errors That Burn Locum Physicians

It’s your first real attending gig after residency.
You just signed a 3‑month locums contract in a new state, the hourly rate looks great, travel is covered, housing is handled. The recruiter said, “Don’t worry, we provide malpractice.” You nod, because everyone says that.

Fast‑forward eight months.

You’re back home, on a new assignment, when an email pops up from some law firm you’ve never heard of. A patient from that first locums job is suing. The care was 6 months ago. The contract ended 3 months ago. You assume you’re covered.

You dig for the old contract. There’s one line about malpractice:
“Agency to provide malpractice insurance during the term of this Agreement.”

That was the moment you realized you never actually confirmed:
What kind. How long. And whether you’d still be covered after you left.

This is exactly how locum physicians get burned.

Let’s prevent that.

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1. Blindly Trusting “We Provide Malpractice” Without Details

This is the rookie mistake. And frankly, it’s the one I see even experienced attendings repeat when they’re tired, desperate for coverage shifts, or just overwhelmed.

You hear:

• “We provide malpractice.”
• “It’s all standard.”
• “Everyone signs this.”

You do not hear:

• Is it claims‑made or occurrence?
• What are the policy limits?
• Who buys tail — and when?
• Are you a named insured or just “covered under our policy”?

You sign anyway.

Why this burns locum physicians

Because that vague sentence about malpractice is not a shield. It’s a placeholder.

I’ve seen physicians assume they’re covered, only to discover:

• Coverage was claims‑made, but no tail was purchased.
• Policy limits were low and already eroded by other claims.
• They weren’t personally named; they were just “provided defense at the company’s discretion.”
• Coverage only applied while actively on assignment, not after.

And if you think “the agency will just handle it” — don’t. Agencies protect themselves first. Hospitals protect themselves second. You’re third. At best.

What you must insist on, in writing

Do not start an assignment until you have all of this explicitly confirmed, in writing (email plus contract):

• Type of policy: claims‑made vs occurrence
• Policy limits: per claim / aggregate
• Who is named: you personally, or just “locum providers”?
• Who pays for tail coverage (if claims‑made)?
• Coverage territory and venues (state, federal, telehealth, etc.)

If a recruiter gets annoyed that you’re “overthinking this,” that’s not a small red flag. That’s a fire alarm.

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2. Not Understanding Claims‑Made vs Occurrence (And Getting Crushed by Tail)

If you do not understand this difference cold, you are a malpractice claim waiting to happen.

Quick reality check

• Occurrence: Covers incidents that occur during the policy period, no matter when the claim is filed. No tail needed.
• Claims‑made: Covers claims that are both:
  • About incidents that occurred during the policy period
  • And are filed while the policy is active (or while a tail is in place)

You stop paying → the policy stops covering new claims → unless you buy tail.

How this wrecks locums physicians

Three classic disaster scenarios:

1. The short‑term assignment with long‑term risk

   You work 3 months in a busy ED in another state. Company provides claims‑made coverage. When you’re done, they do not buy tail. A claim hits 18 months later. You’re exposed personally.

2. You assume tail is included — and it’s not

   The contract says, “Malpractice coverage will be provided during the term of this Agreement.” That sounds good. It isn’t. That phrase silently implies no tail obligation.

3. You switch agencies and create coverage gaps

   You leave Agency A (claims‑made policy) and join Agency B (also claims‑made). Neither buys tail for your old coverage. Your new policy covers incidents only going forward; the old period is now a dead zone.

The tail cost trap

Tail coverage isn’t cheap. For an individual physician, it can be:

Specialty	Approx Tail Cost (as % of annual premium)
Internal Med	150–200%
EM	175–225%
OB/GYN	200–250%
Surgery	175–225%
Psych	125–175%

If the annual premium would have been $15,000, tail could easily hit $25,000–$35,000. For some high‑risk specialties, more.

You do not want to discover that you owe that, out of pocket, because you didn’t force the contract to specify who buys tail.

How not to get burned here

Be explicit:

• For claims‑made coverage:
  “Locum company shall be solely responsible for purchasing and maintaining any required tail coverage for all services performed under this Agreement. Physician shall have no financial responsibility for tail coverage.”

• If they refuse to buy tail, you at least know the actual cost of saying yes to that assignment. Then you can either walk away or demand a huge rate premium to offset that risk and expense. Personally? I’d walk.

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3. Ignoring Policy Limits and “Shared” Coverage

Another quiet trap: you assume that if there’s malpractice insurance, the limits are “standard” and you’re fine.

Not always.

Common Malpractice Policy Limits for Locum Physicians

Category	Value
Low	500000
Typical	1000000
Higher	2000000
Hospital Preferred	3000000

Most locums gigs land somewhere in the $1M / $3M (per claim / aggregate) range. But I’ve seen contracts at $500k / $1M. And worse — shared limits.

How shared limits quietly put you last in line

Shared limits means:

• You and multiple other physicians are drawing from the same $1M / $3M pot.
• If another provider racks up one or two large claims, there may be very little left if your case hits.

I’ve seen situations where:

• A group policy covered 10+ physicians.
• Two large settlements nearly drained the aggregate.
• The third physician’s case landed after the limit was largely exhausted. The carrier tried to walk away, and suddenly the physician’s personal assets were on the table.

The locum physicians in those situations? Usually the least informed, and the least protected.

What you must ask directly

• Are limits per provider or shared?
• Exact numbers: “What are the per‑claim and aggregate limits?”
• Any eroding provisions? (Defense costs inside vs outside limits.)

If the recruiter says, “Oh, standard. Don’t worry,” respond:
“Standard doesn’t mean anything to me. I need the actual numbers.”

If they cannot tell you the numbers, they don’t know what they’re selling you into. That’s not someone you trust with your license.

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4. Assuming Coverage Follows You Across States and Settings

Locum life often = multiple states, multiple facilities, and sometimes telehealth. That’s exactly where malpractice coverage gets messy.

The state mismatch problem

Common failures:

• Your policy is written with one state as the primary venue, but you’re working in another.
• Venue‑specific provisions or higher risk states (NY, FL, PA) are treated differently by carriers.
• Cross‑state telehealth isn’t clearly addressed in your coverage.

If the claim arises in a state not properly included or rated, you can end up in a coverage dispute you didn’t even know was possible.

The setting mismatch problem

Locum physicians often cross:

• Inpatient vs outpatient
• Urgent care vs ED vs telehealth
• Hospitalist vs ICU vs procedure work

Your malpractice policy might be calibrated, priced, and underwritten for one type of work. If your actual practice pattern differs, you may trip exclusions or misrepresentation issues.

Typical wording you’ll see in policies:
“Coverage applies only to professional services customarily rendered within the scope of the insured’s specialty and disclosed practice settings.”

If you’re boarded in IM but moonlighting in the ED, you’d better be sure that’s explicitly covered. Don’t count on “everyone does it” as a defense.

What to verify before saying yes to a multi‑state or unusual gig

You want a clear, written answer to:

• Are all states where I’ll work specifically covered under this policy?
• Are all settings and roles (hospitalist, ED, telehealth, procedures) covered and appropriately rated?
• Are any specific states (e.g., NY, FL, CA, PA, NJ, IL) excluded or surcharged?

If a locum company gets defensive when you ask, that’s telling you exactly how much they care about your risk: not much.

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5. Overlooking Contract Language That Shifts Liability Back to You

This one’s sneaky. Because yes, they “provide malpractice.” But then they write the contract in a way that sends a big chunk of liability right back into your lap.

Watch for these landmines:

Indemnification clauses that eat you alive

Example language:

“Physician agrees to indemnify, defend, and hold harmless the Company and Facility from any and all claims arising from Physician’s acts or omissions.”

Translation:
If there’s a claim, you may be on the hook for their legal costs, settlement amounts, and anything not covered by insurance.

A fairer version:

“To the extent covered by the malpractice insurance provided under this Agreement, Physician shall cooperate in the defense of any claim. Physician shall not be responsible for indemnifying Company or Facility for claims within the scope of such insurance.”

If they insist on broad indemnification in your direction, but not vice versa, that’s a huge imbalance of power and risk.

“Cooperation” language with hidden traps

Some policies and contracts require that you:

• Notify of potential claims immediately
• Avoid any admission of fault
• Never settle or offer compensation without consent

If you violate these, the carrier may try to deny coverage.

You must understand:

• How soon do I need to report an incident?
• What counts as “knowledge of a potential claim”?
• Are there any duties I need to follow after I’ve left the assignment?

Do not gloss over those sections. That’s where coverage gets voided.

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6. Failing to Track Your Own Coverage History (And Losing Proof When You Need It)

Here’s a scenario I’ve watched play out more than once:

You’ve done 5 different locum gigs over 4 years. Different agencies. Different hospitals. Some short, some long. You assume everyone kept good records.

Then a credentialing office asks you for proof of malpractice coverage for each year you’ve practiced. Or worse, you get a claim, and the carrier says, “We don’t have you in our system.”

You realize you never kept certificates. Old recruiters are gone. The agency was acquired. The hospital switched vendors. The paper trail is a mess.

Common Points Where Locum Physicians Lose Malpractice Documentation

Category	Value
Agency change	70
Hospital vendor switch	55
Email account loss	40
Old portal access removed	60

Do not trust others to keep your proof

You need your own archive:

• Certificate of insurance (COI) for each assignment
• Policy type (claims‑made vs occurrence)
• Policy limits (per claim / aggregate)
• Confirmation of tail (if applicable) — ideally in writing

Without that, years later, you may struggle to:

• Get credentialed at a new hospital
• Prove continuous coverage
• Sort out who should respond to a claim from 3 years ago

How to do this like a pro

Create a private folder (encrypted cloud storage is fine) with subfolders by year. For every new assignment:

• Ask for the COI with:
  • Your full name
  • Dates of coverage
  • Limits
  • Carrier name
• Save a PDF copy immediately.
• Save email confirmation that tail will be purchased (if claims‑made).

Treat this like protecting your passport. Because it’s that level of important for your career.

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7. Believing You “Don’t Need Your Own Policy” — Until You Do

Many locum physicians rely 100% on agency‑ or hospital‑provided coverage. Sometimes that works. But here’s how that can backfire:

• You get dropped from an assignment mid‑contract after a conflict. The company quietly removes you from their policy.
• You do some moonlighting that’s technically outside your contracted role (e.g., telehealth on the side, informal curbside consults that turn into more).
• You get named in a suit involving multiple facilities, and the coverage question becomes a messy jurisdiction battle.

In all those situations, having your own individual malpractice policy can be the difference between sleeping at night and paying some defense lawyer $500/hour from your own bank account.

Is it always necessary? No. Is it always cheap? Also no. But ignoring the option completely is shortsighted.

When I’d strongly consider my own policy as a locum

• You work with multiple agencies regularly.
• You have a mix of in‑person and telehealth work.
• You do side gigs (chart review, expert witness, informal consults).
• You are in a high‑risk specialty (OB, surgery, EM, anesthesia, critical care).

Your own policy gives you:

• A central, continuous coverage record
• Control of carrier choice
• Clear terms in your name, not buried in someone else’s group contract

At minimum, you should have a real conversation with a malpractice broker who understands locum work and spells out your actual risk.

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FAQ (Exactly 5 Questions)

1. Should I avoid all assignments that use claims‑made malpractice coverage?

No, you don’t have to avoid them. But you must make sure someone else is contractually obligated to buy tail — and that it’s spelled out clearly. If the locum company won’t commit to paying for tail, factor that into your decision. For short‑term gigs with no tail, the risk–reward ratio is usually terrible.

2. Is $1M/$3M coverage enough for a locum physician?

In many markets, $1M per claim / $3M aggregate is standard. But that only matters if the limits are per provider, not shared, and if the state you’re in doesn’t routinely see verdicts that blow past that. You should verify local norms with a malpractice broker or colleagues in that state instead of assuming “standard” is safe.

3. How do I know if my coverage is occurrence or claims‑made?

You don’t guess. You ask for (and read) the certificate of insurance or policy summary. It will state “Claims‑Made” or “Occurrence.” If you can’t get that document, that’s already a problem. Push the agency or hospital to send proof, not just reassurance.

4. Can a past locum assignment drop me from coverage after I leave?

They can’t retroactively erase coverage for the time you were properly insured under a valid policy. But with claims‑made coverage, once the policy ends and there’s no tail, you won’t be protected against newly filed claims for that old work. That’s why tail or occurrence coverage is non‑negotiable for locum assignments.

5. What’s the one malpractice document I should never lose as a locum physician?

Your certificate of insurance (COI) for every assignment. That document proves you were covered, for what period, by what carrier, and with which limits. Keep every COI, plus any written confirmation about tail coverage, in a secure, backed‑up folder. When (not if) someone asks ten years from now, you’ll be very glad you did.

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Key Takeaways

1. Never accept “we provide malpractice” without written specifics: type, limits, tail, and who is named.
2. Claims‑made without guaranteed tail is a loaded gun pointed at your future; occurrence or paid‑for tail is the safety.
3. Track your own coverage history obsessively — COIs, tail confirmations, and where you worked — because no one else will protect you like you should.