1. Forms
2. PR
3. PR-00-02

What the form is

The PR 00 02 Physicians, Surgeons and Dentists Professional Liability Coverage Form is a standard Insurance Services Office (ISO) claims-made policy. Its primary purpose is to provide professional liability (malpractice) insurance for medical professionals such as physicians, surgeons, and dentists. This form agrees to pay those sums that the insured becomes legally obligated to pay as damages because of an injury caused by a "medical incident". A key feature of this claims-made form is that coverage is triggered when a claim is first made against the insured during the policy period or any applicable extended reporting period, for incidents that occurred on or after the policy's retroactive date.

The form is structured with two main coverage grants:

• Coverage A – Individual Professional Liability: This covers the individual named insured for their professional actions.
• Coverage B – Partnership, Limited Liability Company, Association or Corporation Professional Liability: This covers the liability of the named business entity.

Classes of business it applies to

This form is specifically designed for the healthcare industry, covering:

• Individual physicians
• Individual surgeons
• Individual dentists
• Medical practices organized as partnerships
• Limited Liability Companies (LLCs) providing medical or dental services
• Medical associations or corporations

For example, a solo practitioner dentist would be insured under Coverage A. A multi-physician surgical group organized as an LLC would be insured under Coverage B for the entity's liability, and each physician would typically also need individual coverage (often Coverage A or a similar form) for their personal professional acts.

Special considerations

• Claims-Made Nature: The most critical aspect is that a claim must be made and reported during the policy period or an extended reporting period (ERP). This differs from an "occurrence" policy (like the PR 00 01) where the policy in effect at the time the incident occurred responds, regardless of when the claim is made.
• Retroactive Date: Coverage is typically limited to acts or omissions that occur on or after a specified retroactive date. Claims arising from incidents before this date are not covered.
• Extended Reporting Periods (ERPs or "Tail Coverage"): These are crucial when a claims-made policy is terminated (e.g., due to retirement, change of insurer, or cessation of practice). The PR 00 02 includes provisions for ERPs, some of which may be automatic upon death, permanent disability, or retirement after age 55 with a certain number of consecutive years of claims-made coverage. Others may need to be purchased.
• Consent to Settle: The standard PR 00 02 form may give the insurance company the right to settle claims without the insured's consent. The PR 24 00 Consent to Settle Endorsement can be used to require the insured's consent.
• Defense Costs: Supplementary Payments often include defense expenses, which may be paid outside the limits of insurance, a significant benefit as defense costs can be substantial.
• Scope of "Medical Incident": This is a defined term and typically includes acts or omissions in providing or failing to provide professional medical or dental services, including the acts of anyone under the insured's direction or supervision. It can also include service on an accreditation or standards review board.
• Exclusions: Like all policies, it contains exclusions. It's important to note that this form covers professional liability only, not general liability exposures like slip-and-fall accidents on the premises; a separate Commercial General Liability (CGL) policy is needed for those.

Key information for agents and underwriters

• Individual vs. Entity Coverage: It's crucial to ensure that both the medical entity (under Coverage B) and the individual practitioners (typically under Coverage A or equivalent) have appropriate coverage. Coverage B does not automatically cover the individual professional acts of partners, members, or directors; they need their own individual coverage.
• Retroactive Date Management: Underwriters must carefully assess and establish the correct retroactive date, especially when an insured is switching from another claims-made policy, to avoid coverage gaps.
• ERP Awareness: Agents must educate clients on the importance and availability of ERPs, particularly when there's a potential for the policy to be non-renewed or cancelled, or when the insured is planning to retire.
• Prior Acts Coverage: When writing new business, determining if prior acts coverage is needed and appropriate is a key underwriting consideration.
• Limits and Deductibles: Appropriate limits of liability and deductibles must be determined based on the specialty, location, and risk profile of the insured.
• Comparison with Occurrence Forms: Agents should be able to clearly explain the differences between claims-made (PR 00 02) and occurrence (PR 00 01) forms to clients.