Protect & Defend columnist Ed Branam, DVM, is the veterinary and animal services program manager at Safehold Special Risk Inc. A 1977 graduate of the Michigan State University College of Veterinary Medicine, Dr. Branam has worked in the insurance industry for the past 20 years. He is a former Sacramento, California, veterinarian and a former veterinary affairs manager with Hill’s Pet Nutrition.Read Articles Written by Ed Branam
Companion animals play an ever-increasing role in society. They have migrated from the barn and backyard to become members of the household, spending their days lounging on our couches and beds. Therefore, it is not surprising that when a pet dies or experiences an adverse event during the delivery of veterinary care, the owner frequently demands financial and emotional restitution.
Monetary recovery arising from a veterinarian’s error or omission is limited in most U.S. jurisdictions to the animal’s fair market replacement value. In a society where millions of unwanted pets are abandoned and euthanized each year, one can argue that the true market value of the vast majority of companion animals is, at most, a few hundred dollars. Obviously, this approach does not take into consideration the emotional role an animal plays in a client’s life.
Consequently, pet owners are turning to state veterinary licensing bodies for emotional restitution. Though they can’t seek financial relief from the state agencies, the owners can adversely affect a veterinarian’s professional reputation and ability to practice.
Liability insurance designed to defend a veterinarian against allegations of professional wrongdoing, whether lodged in a lawsuit or state board complaint, is available at a very reasonable cost.
Let’s explore further.
Professional Liability Insurance
Liability policies protect and defend a veterinarian against civil allegations of negligence or malpractice resulting from the delivery of services below the standard of care.
The basic types of professional liability policies are:
- Individual: A single veterinarian is identified on the insurance policy.
- Business: The business entity is the named policyholder. Coverage includes the business and all veterinarians and staff members working on behalf of the hospital regardless of whether they are full time, part time or relief. Individual policies are not required when business coverage is in effect.
Here’s what you should look for:
1. Adequate limits. Small animal veterinarians should consider minimum coverage of $1 million to $2 million per occurrence. Veterinarians working with herds and high-value animals should contemplate higher limits. Consult your attorney for specific recommendations.
Why million-dollar coverage? Consider the following case study.
A family brought a new puppy into a veterinary practice for a physical exam, fecal test and vaccines. The puppy appeared healthy, the fecal exam was negative, and appropriate immunization vaccines were administered. The client returned with the puppy, as instructed, until the initial well-puppy protocol established by the attending veterinarian was completed. Four months later, the veterinarian was served with a lawsuit alleging negligence in the delivery of veterinary services during the puppy’s treatment. The suit claimed the standard of care as defined by the Companion Animal Parasite Council dictated that their puppy should have received a deworming treatment protocol regardless of repeated negative fecal results. The injury noted in the lawsuit was permanent loss of vision in the left eye of the family’s 4-year-old son because of intraocular ascarid migration. The court awarded damages of $1.3 million.
2. Defense attorneys. Whom does the insurer use for claims defense? Ensure that only nationally recognized veterinary civil litigation specialists are hired.
3. Consent to settle. Your reputation is at risk, so ensure that no claim can be settled without your written consent or a court order.
4. No hammer clause. A hammer clause states that if you refuse to agree to the settlement your insurance company has negotiated, you may become financially responsible for all or a significant portion of any additional legal expenses and judgments. Make sure your policy does not include a hammer clause.
5. Knowledgeable claims adjusters. Inquire about the claims specialists’ experience. Request an adjuster who specializes in veterinary litigation.
6. Expert witnesses. Confirm that your insurer utilizes experts on your behalf.
If you think you might be sued or if you are, remember to:
- Report all claims immediately to your insurance company.
- Report all potential claims arising from a disgruntled client or a poor therapeutic outcome. Inform the claims representative that the report is “for information purposes only.”
- Get confirmation from your insurance representative that no settlement will be made without your approval.
- Always demonstrate concern and compassion for the client and the pet when discussing a miscommunication or negative therapeutic outcome.
- Apologize to the client, if appropriate. However, do not admit overt guilt or wrongdoing until after you have discussed the case with your insurance representative or attorney.
- Refer all questions from the client’s legal representatives to your claims representative or attorney.
- Do not agree to a settlement or infer an intent to settle when communicating with the client or the client’s representative. Your claims person or attorney should handle negotiations. Agreeing to a financial settlement without the approval of your insurance company can invalidate your coverage, expose you to further litigation and trigger automatic reporting to the state licensing board. Many states require notification when a professional liability settlement over a stipulated amount is paid.
- Do not speculate in the medical record about the cause of death. Only state the known facts. A necropsy should be performed — by a veterinary pathologist, if possible — when the cause is unknown.
- Do not provide the client or the representative with the original medical record, radiographs or miscellaneous supporting documents. Do provide copies to the client if requested. Consult your attorney for guidance.
License Defense Insurance
Legal expenses incurred when a state licensing board files a complaint against a veterinarian are covered under this policy. The insurance might be part of the professional liability policy or it might be a separately purchased endorsement.
Several insurance companies offer up to $100,000 in annual coverage. The difference in price between a lower limit and $100,000 is minimal. I recommend the additional protection of a higher coverage limit, but consult an attorney if you are not sure what is best for you.
As with civil litigation claims, make sure your insurer utilizes attorneys who have experience with your state’s veterinary licensing board. Also ask whether the company has access to expert consultants.
When it comes to a state licensing board complaint:
- Immediately report all board complaints to your insurer.
- Do not respond to the board without legal assistance.
- Ask your insurer for a list of attorneys in your state who specialize in veterinary licensing board complaints.
Without appropriate professional liability protection, your financial status, reputation and ability to practice veterinary medicine could be at risk. So, do your homework and make sure you are adequately protected.