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Critical Tips for Protecting Your Practice from Dangerous Business Risks

Medical practices are legal business entities that carry significant financial risks. While it is impossible to remove 100 percent of everyday risks, physicians should take prudent steps to mitigate business and financial risks to their practices.

Accidents happen more often than you may think and the impact on your practice can be far reaching. An accident such as a fire or flooding can cause a medical practice to incur significant, unanticipated expenses, expenses such as securing temporary office space, notifying patients, increasing payroll costs, and replacing and repairing damaged inventory or equipment.

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A Business Owners Policy (BOP) is one of the best ways to protect your practice and mitigate your business losses. It combines a wide range of business liability and property/casualty coverage into a single package.

A Good BOP Policy:

  • Provides insurance against alleged claims of personal  injury or damage unrelated to medical malpractice, including cost of legal defense and settlements
  • Repairs or replaces damaged buildings, equipment, or other business property
  • Reimburses lost income or costs if the practice closes following a property loss
  • Covers the cost of replacing or restoring damaged records or files due to a property loss
  • Pays for medical costs of individuals other than employees who are injured at your practice

Plus, some BOP policies include the additional installation of a free water sensor program to help avoid potentially devastating water damage!

Although a BOP policy will cover the financial damages associated with a non-employee, non-clinical injury that occurred in your practice, it will not cover employee injuries occurring because of a workplace accident. There are many common risks in a medical practice that can lead to employee injuries - biological hazards, needles, other chemical and drug hazards and regular trip and falls.

Most medical practices are likely well-acquainted with a safety-first culture and provide the necessary OSHA training for employees to help avoid accidents of any kind. However, accidents will and do happen. That is why all California employers are required to have workers’ compensation insurance. Failure to do so may results in heavy fines and penalties.

When an injury occurs on the job, both productivity and profits suffer, yet many employers continue to be inadequately covered or not covered at all. Workers’ compensation insurance protects you and your employees.

A Good Workers’ Compensation Policy:

  • Covers the medical expenses of the injured employee
  • Covers the employee's lost income
  • Helps the employer return their employee to work sooner
  • Protects the business owner from accident-related lawsuits
  • Ensures a seamless and effective claims process

Pricing for workers’ compensation varies but is primarily driven by gross payroll costs and claims history. When shopping for insurance, physicians should find a trusted financial advisor to discuss how much coverage they need. If possible, physicians should either consolidate their insurance business with an agency that can handle all of their insurance needs, or create visibility of their entire portfolio for their advisor to see.

CAP Physicians Insurance Agency, Inc. (CAP Agency) is a full-service insurance agency created to support CAP members. CAP Agency's licensed and trained professional insurance agents have expertise in all lines of business and personal insurance coverage, and they know healthcare. They can provide you with a comprehensive review of your risk exposures, assess your current coverage, and provide you with comparative, competitive quotes at no cost to you. To learn more, call 800-819-0061 or email