Malpractice Insurance Options for the Locum Tenens Doctor
/We have all been trained to practice medicine, years of medical school and residency have prepared us to care for patients. Exactly how and where we practice is unique to all of us, from an emergency medicine doctor on a locums assignment in Hawaii to an employed hospitalist in New York City. We all aim to do our best in a setting of our choice. However, the grim reality is we are at risk of being sued. It’s unfortunate, stressful, and can be life changing. Being prepared for this event can help make the roller coaster ride much smoother.
It is estimated that approximately 200,000 people die each year from medical errors, but only 2 percent of these are ever brought to a lawsuit. Interestingly, the number of malpractice suits is decreasing, with 16,000 paid events in 2001 but only 8500 paid events in 2016. That’s an almost 50% decline in malpractice lawsuits. On top of that, the average payment has declines almost 25% in that time. Put together, malpractice lawsuits are on the decline and payments are shrinking. Let’s hope the days of 20 million-dollar verdicts for losing psychic powers are behind us!! That said, mistakes happen, and you need to be protected.
There are two main groups of malpractice insurance: Claims-Made Policies and Occurrence Policies. Claims-Made policies cover you for an event or lawsuit that happens while you are holding that insurance. As an example, if you are on assignment with a locums position and you get sued, the policy will cover you. For these policies, once the assignment is over, the policy no longer covers you. What happens if you get sued the day after the assignment ends? Well, you need to prepare for this. “Tail-Coverage” is the term used to describe the policy you need to hold AFTER the assignment ends. This tail coverage will provide malpractice insurance after the assignment ends. In Occurrence Based policies, the insurance provides lifetime coverage for any claim that occurred while the policy was in effect, regardless of when the claim was made. Clearly the occurrence-based policies are better, but they are often more expensive. So, how are these premiums set? Most policies are dictated by specialty, geographic area of practice, and personal malpractice history.
As an employed or private practice physician, malpractice insurance is often provided as part of your employment or partnership agreement. Your partners and/or employers do the legwork to set up a plan and enroll you. When it comes to Locum Tenens work, the options are slightly different. We wanted to outline all your options and define the best way of protecting your career.
There are several options for Locum Tenens doctor to obtain malpractice insurance. The first, and perhaps most common, is to utilize the locum tenens staffing agencies malpractice plan. The second is to acquire your own independent malpractice insurance. The third is to utilize the malpractice insurance of the hospital or practice that is contracting with you. Let’s take a look into all three of these options.
Letting the Locum Tenens staffing agency provide coverage typically is the easiest approach to malpractice insurance. We reached out to 10 different staffing agencies and surveyed their malpractice plans. Across the board, all staffing agencies provide claims-made policies when you are on assignment. The typically plan covers you for up to 1 million dollars for each event and a total of 3 million. The typically policy was for 12 months, regardless of the length of your assignment. In addition, all but one agency provided tail coverage for events that may come up after the assignment has ended. There are many more details about the specifics of these plans, but in general we found the staffing agencies has good plans with good coverage. As an aside, many physicians chose to obtain an individual Umbrella Policy outside of the staffing agency, these plans cover any verdicts that would exceed the 1million/3million coverage, but we have to stress that these cases are rare.
The second option is to buy individual malpractice. We admit, this option is daunting at first, but we found it to be not so unreasonable after several conversations with insurance brokers. We have found that physicians who take on locum tenens assignments outside their permanent position often turn to individual plans, since their malpractice with their group or practice may not cover their locums work. Cost is the most important factor here. Keep in mind, when you utilize the malpractice from a staffing agency, its baked into the negotiations in regard to what they pay you. Having your own may seem like a benefit, as you could negotiate higher rates, but the overhead is little to add one new physician to their plan. It’s a small cost to them, but it could be a big cost to you.
Finally, some health systems, hospitals and practices may be able to add you to their plan as part of your package. Similar to a staffing agency, a hospital can add you to their existing plan at a lower rate and that coverage can be enough for your assignment. As your assignment may be in a smaller hospital or more remote location than your used to, it’s important to review the policy before assuming it has you protected. Knowing the type of policy they offer is critical, as is understanding the limits of liability. However, it is also important to ensure the carrier is financially sound and you won’t be left out to dry in 5 years when a malpractice suit is brought against you and the company is no longer around. Make sure the carrier they utilize is a major player with a record of quality business.
All in all, we found the murky and confusing world of malpractice insurance for locum tenens doctors to be fairly reasonable. Some potential landmines, but not many tricks here that you need to worry about. If possible, we recommend utilizing the staffing companies plans, but make sure you review them prior to signing any contracts.
~The Locums Life
FAQ: Locum Tenens Malpractice Insurance Options
1) What is locum tenens malpractice insurance in plain English?
Locum tenens malpractice insurance is the professional liability coverage that protects you financially and legally if you’re sued for alleged medical negligence while working a locum tenens assignment. Because locum tenens physicians often work short-term contracts across multiple facilities (and sometimes multiple states), your malpractice insurance must clearly cover your location, scope of practice, dates of service, and claim type—or you can end up exposed.
2) Why is malpractice insurance different for locum tenens doctors compared to employed physicians?
When you’re employed (W-2), the hospital or group usually provides malpractice coverage under their corporate policy, and you rarely see the fine print. As a locum tenens doctor (typically 1099), coverage is often arranged through:
the staffing agency,
the facility,
or your own policy.
The complexity comes from short-term work, shifting sites, multiple states, credentialing requirements, and contract-driven insurance terms (especially around tail coverage).
3) What are the main malpractice insurance options for locum tenens physicians?
Most locum tenens malpractice coverage falls into three buckets:
Agency-provided coverage (most common)
Facility/hospital-provided coverage (sometimes)
Your own independent policy (less common, but valuable in some scenarios)
Each option can be safe—if the contract language is clear and the policy matches your real clinical duties.
4) Which malpractice option is “best” for most locums doctors?
For most physicians starting locums, agency-provided malpractice insurance with clearly stated tail coverage (if claims-made) is the simplest and safest default. It reduces administrative friction, typically meets facility credentialing requirements, and prevents you from having to shop coverage for every assignment.
5) What’s the most important malpractice question to ask before signing any locum tenens contract?
Ask this exact question:
“Is the policy occurrence-based or claims-made—and if claims-made, who pays for tail coverage and when does it start?”
If you don’t get a clear answer in writing, you don’t really know your risk.
6) What is an “occurrence” malpractice policy?
An occurrence policy covers you for incidents that occur during the policy period—no matter when the claim is filed.
Example: You treat a patient in 2026, and they sue in 2031. If you had occurrence coverage in 2026, you’re typically covered even years later.
Pros: simpler, no tail needed
Cons: often more expensive and less commonly offered in locums arrangements
7) What is a “claims-made” malpractice policy?
A claims-made policy covers claims that are made (filed) while the policy is active. If the policy ends and a claim is filed later, you may not be covered—unless you have tail coverage.
Pros: common, often lower upfront cost
Cons: requires tail (or nose) coverage planning
8) What is “tail coverage,” and why does it matter so much in locum tenens?
Tail coverage is an extension that protects you after a claims-made policy ends, for incidents that occurred during the policy period but are reported later.
For locum tenens physicians who move from assignment to assignment, tail coverage is critical because claims often arise months to years after care occurs.
If your contract says “claims-made” and doesn’t explicitly address tail, that’s a major risk.
9) Who should pay for tail coverage in locum tenens work?
Many staffing agencies will include tail coverage as part of the package—but do not assume it. Sometimes:
the agency pays,
the facility pays,
or the physician is responsible.
The “right” answer is whatever you negotiate—but it must be written. Tail can be expensive, so you never want it to become a surprise bill.
10) What is “nose coverage” (prior acts coverage)?
Nose coverage (also called prior acts coverage) is purchased when you start a new claims-made policy and want it to cover work you did in the past. It’s essentially the alternative to buying tail from the old policy.
In locums, nose coverage is less common unless you’re transitioning into a new long-term policy arrangement.
11) If I work multiple locum tenens assignments in a year, do I need separate malpractice coverage for each one?
Often, yes—your coverage typically must match the specific assignment dates, locations, and facility requirements. Many agencies issue coverage tied to your assignment. If you’re using your own policy, you may need endorsements for each location/state and to ensure your policy follows you appropriately.
12) What are the typical coverage limits for locum tenens malpractice insurance?
A common structure is $1 million / $3 million:
$1M per claim
$3M aggregate (total the policy will pay during the policy period)
Some assignments require higher limits or different structures depending on specialty, state, and facility type. Always confirm the facility’s minimum requirements.
13) Does locum tenens malpractice insurance cover me in every state?
Not automatically. Coverage depends on:
whether the insurer covers that state,
whether your assignment location is listed,
and whether your scope and facility type are included.
Always confirm the policy is valid for the state(s) you’re working in—especially if you’re rotating across multiple states.
14) What is the difference between being covered under the facility’s policy vs an agency policy?
Facility policy:
may be convenient and compliant for that hospital
may have nuances around consent to settle, reporting, and how defense is managed
may not follow you outside that facility
Agency policy:
often tailored to traveling clinicians
often easier across assignments
but you must confirm dates, tail, and scope
Neither is inherently better—clarity and scope match are what matter.
15) Do I need malpractice coverage for telemedicine locum tenens work?
Yes. Telemedicine creates additional complexity:
licensure and jurisdiction issues (patient location often matters)
policy may require telemedicine endorsements
cross-state practice can create coverage gaps
If you’re doing locums telemedicine, confirm your malpractice explicitly covers telemedicine and the states where patients are located.
16) What is “scope of practice” and why is it a malpractice risk?
Your malpractice coverage must match what you’re actually doing clinically:
procedures
supervision of APPs
call responsibilities
inpatient vs outpatient
surgical vs non-surgical
OB coverage (for relevant specialties)
If you do something outside declared scope, the insurer may deny coverage. Scope creep is a huge risk in locums.
17) How do I protect myself from “scope creep”?
Make sure the contract explicitly states:
clinical settings (clinic, OR, hospital, ED, etc.)
procedures expected
supervision requirements
call coverage
locations/sites covered
Then match those details to the insurance certificate/terms. If the hospital says, “Can you also cover X?”—pause and confirm coverage before agreeing.
18) What is “consent to settle,” and should I care?
Consent to settle means the insurer must get your consent before settling a claim. Without it, a case could be settled over your objection, which may affect your reputation and future credentialing.
Some policies include consent-to-settle language; some do not. If you have concerns, ask if it exists and whether there is a “hammer clause” (which can limit the insurer’s liability if you refuse settlement).
19) What is a “hammer clause”?
A hammer clause may limit what the insurer will pay if you refuse a settlement they recommend. It’s not always bad, but you should understand it. If you strongly value control over settlements, ask about this clause.
20) Does malpractice insurance cover licensing board complaints?
Not always. Malpractice policies focus on civil claims. Some policies offer endorsements or separate coverage for:
board investigations
credentialing issues
deposition representation
If you want this protection, you may need additional coverage beyond standard malpractice.
21) Does locum tenens malpractice insurance cover “moonlighting” or side gigs?
Not automatically. Coverage is usually assignment-specific. If you pick up extra shifts outside the contracted facility or do unrelated clinical work, that may require separate coverage. Never assume “I’m covered because I’m insured.” Make sure the work is listed/endorsed.
22) What is “prior acts date,” and why should locums doctors check it?
On a claims-made policy, the “retro date” or prior acts date defines how far back coverage applies for incidents. If you’re depending on a claims-made structure across time, this date matters. If it resets or excludes prior work, you can create gaps.
23) How can I verify malpractice coverage is real and active?
Ask for:
Certificate of Insurance (COI)
Carrier name and policy number
Coverage limits
Policy type (claims-made vs occurrence)
Named insured (you)
Effective dates
Tail confirmation (if applicable)
Keep a personal folder of COIs for each assignment.
24) What if the recruiter says “malpractice is covered” but can’t provide details?
Treat that as “not covered yet.” You need specifics and documentation. It’s normal for agencies to confirm details once an assignment is finalized, but before you work a shift, you should have the COI or written confirmation.
25) Do I need my own malpractice insurance if the agency provides it?
Not usually, but sometimes physicians choose additional coverage for:
broader scope across multiple gigs
higher limits
added licensing board defense
personal peace of mind
If you buy your own policy, ensure it doesn’t conflict with facility/agency requirements and that you’re not paying for redundant coverage.
26) What are common red flags in locum tenens malpractice language?
Claims-made policy with no explicit tail coverage
Coverage not listing your name as insured
Unclear effective dates
Ambiguous scope (no mention of procedures or settings)
Facility asking you to “use their policy” but won’t provide documentation
Contract pushes malpractice risk or costs to you without clear compensation
27) How do malpractice needs differ for high-risk specialties?
Higher-risk specialties (e.g., OB, surgery, emergency medicine, anesthesia in some settings) may face:
higher premiums
stricter facility requirements
more exclusions
more attention to supervision and call
If you’re in a higher-risk specialty, insist on extra clarity around limits, tail, and scope.
28) What about “shared limits” under a facility policy—are those risky?
They can be. Shared limits mean multiple clinicians draw from the same aggregate. It’s not always a dealbreaker, but it’s something to understand. If you’re covered under a facility’s group policy, ask how limits apply.
29) If I switch agencies, do I risk malpractice gaps?
Potentially. Each agency may have different carriers and policy terms. If you’re hopping between assignments and agencies, maintain a personal record of:
policy type per assignment
whether tail was included
COIs and dates
Your biggest risk is a claims-made policy ending without tail coverage.
30) What is the simplest “malpractice checklist” for every locums assignment?
Use this before your first shift:
Policy type: occurrence vs claims-made
Limits: $1M/$3M (or facility required)
Named insured: you are explicitly covered
Dates: match assignment dates
Location: facility and state covered
Scope: matches your duties
Tail: confirmed if claims-made
Board coverage: yes/no (if you care)
Consent to settle: yes/no (if you care)
COI saved in your records
31) How does malpractice tie into contract negotiation?
Malpractice terms are negotiable indirectly:
If you’re asked to pay for tail, negotiate a higher rate or bonus
If the facility wants higher limits, ask who pays
If scope is broad, negotiate higher pay and verify coverage
You’re not being picky—you’re managing risk.
32) Does malpractice insurance cover “independent contractor” status differently?
Not in the sense of clinical coverage, but it can affect:
who buys the policy
how it’s structured
how it’s documented
what the contract assigns to you
As a 1099, you must be especially careful that coverage is active and in your name.
33) What if I’m asked to supervise APPs—does malpractice cover that?
It can, but must be explicit. Supervising APPs increases liability exposure. Confirm:
your supervisory role is included in scope
the facility has appropriate policies
the APPs have their own coverage or are covered under facility policy
your insurer is aware of this responsibility
34) Should I buy “excess” or umbrella malpractice coverage?
Some physicians do, especially in higher-risk specialties or higher exposure environments. But it’s not routine for most locums doctors. If you’re considering it, it’s worth a professional insurance review so you’re not overpaying for redundant protection.
35) What’s the bottom line for locum tenens malpractice insurance?
If you take one thing from this: always confirm whether your locum tenens malpractice insurance is occurrence or claims-made, and never accept claims-made coverage without written confirmation of tail coverage and scope alignment. That’s the simplest way to avoid the most common malpractice insurance gap for locum tenens doctors.