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Good Practice: Common Questions and Issues with Insurance

The requirement to personally hold professional liability insurance is established by the College of Physiotherapists of Alberta to ensure that the public is protected and has access to financial recourse in the event of harm due to a physiotherapist’s error, omission, or malpractice. This requirement protects the public by guaranteeing that each member of the College personally holds valid professional liability insurance that meets the minimum requirements established by the College. As a result, a client who sues a member of the College for a professional service rendered is assured of the solvency of the professional in question.

Having professional liability insurance also provides peace of mind for the physiotherapist – knowing that they will have the necessary resources to respond to complaints or civil suits and provide compensation to patients in the event of a civil court finding.

What are the College’s requirements regarding professional liability insurance?

All regulated members are required to personally hold professional liability insurance in the amount of $5 million on any patient and $5 million minimum for the policy year, to ensure coverage wherever they practice as a physiotherapist in Alberta, regardless of their role or employment environment. Holding professional liability insurance is a condition of registration. All regulated members must have an active policy at all times.

The College of Physiotherapists of Alberta provides no recommendations regarding these insurance options. The intent of this article is to ensure that physiotherapists understand the insurance coverage that is required and some of the more common questions and concerns that arise related to professional liability insurance. Please note that all names are pseudonyms, though each of these scenarios has occurred within the recent past.

John works in a hospital. John’s manager says that the hospital’s insurance protects them. Why does John need to buy professional liability insurance?

As a regulated member, John has a permit to practice anywhere in Alberta, in any sector or setting, 24 hours a day and 7 days a week. By tying the professional liability insurance requirement to John’s practice permit, the College of Physiotherapists of Alberta ensures that John has professional liability insurance in place when providing services:

  • At their primary place of employment
  • At any secondary employment locations if they change employment sectors mid-year (e.g., to take a role in private practice)
  • If they engage in volunteer activities related to physiotherapy

Personally carrying professional liability insurance also ensures that coverage is in place if John’s employer were to disavow John’s actions or refuse to provide coverage for an incident occurring in the workplace that the employer deemed to be outside of John’s role or approved activities.

Camilla purchases their personal professional liability insurance through a company whose policy year is July 1- June 30. When Camilla renewed their practice permit on September 5th, they realized that their insurance policy had lapsed on June 30th. They renewed their policy as soon as they realized the mistake, but their new insurance policy indicates the day when Camilla renewed and that there was a lapse in their professional liability coverage.

This is a problem. Like all regulated physiotherapists in Alberta, Camilla is required to personally hold continuous professional liability insurance regardless of the start and end dates of their professional liability insurance policy.

Camilla has placed themself and the College in a precarious position. The College of Physiotherapists of Alberta would have difficulty explaining Camilla’s actions to a patient or other party if a concern or complaint were to arise. Camilla’s gap in coverage also means that they do not have protection for any errors, omissions or instances of malpractice arising between July 1 to September 5, which may not come to light for months or even years.

As this was the first time Camilla made this mistake, the College used one of its regulatory tools and issued a reprimand to Camilla. The reprimand stays on Camilla’s record. If Camilla fails to meet the professional liability insurance requirement a second time this would warrant a referral to the complaints director.

Kenji renewed their practice permit in August. On September 20th they renewed their personal professional liability insurance. Unlike Camilla they did not have a lapse in coverage.

Kenji was surprised that they were contacted by the College following the annual insurance audit. They were advised that they are required to have personal professional liability insurance coverage effective October 1st in place BEFORE renewing their practice permit.

The Physical Therapists Profession Regulation requires that physiotherapists provide evidence of having the type and amount of professional liability insurance required by Council as a condition of registration or practice permit renewal.

Kenji’s renewed practice permit term will begin on October 1. Kenji is required to provide evidence of having liability insurance in effect on that date as a condition of renewal. Kenji provides that evidence by submitting their policy number to the College at the time of submitting their renewal application. To comply with College requirements and avoid making a false declaration to the College, Kenji needed to purchase their personal professional liability insurance before submitting their application for renewal.

If, like Kenji, your insurance period starts October 1 and ends September 30, you still need to purchase your professional liability insurance before you renew, regardless of the date you choose to renew your practice permit.

Erin owns a small physiotherapy business that includes both a clinic site and a mobile practice. Erin holds commercial general liability Insurance. Erin was surprised when they were contacted by the College following the annual insurance audit and advised that they did not have the proper insurance in place.

Commercial general liability is not the same as professional liability insurance. Commercial general liability is not proof of individual professional liability insurance for professional registration purposes.

Erin’s commercial general liability is intended to protect Erin against claims arising from injury or property damage that they (or their business or staff) may cause to another person as a result of their business operations and/or premises, but not as a result of the delivery of professional services.

For example, Erin would use their commercial general liability insurance if a patient was injured by slipping in a puddle on the reception floor. Similarly, Erin would access their commercial general liability if they accidentally broke something in a client’s home during a consultation and the client wanted to recover the cost of this from Erin.

In contrast, if Erin were to burn a patient in the course of providing physiotherapy services, they would access their professional liability insurance to provide coverage for Erin’s actions, omissions or malpractice.

Fatima recently found themself in a similar situation to Erin. Fatima was contacted by the College following the annual insurance audit and were advised that they did not have the proper insurance in place. However, in Fatima’s case, they reported that they had sought to purchase professional liability insurance and that the insurer had issued a commercial general liability insurance policy in error.

While in this case the error was made by another party, it is the physiotherapist’s responsibility to ensure they meet the requirements for registration. Physiotherapists are advised to check their insurance policies at the time of purchase and make sure that any errors are corrected without any lapse in their personal professional liability coverage. This is another reason to complete the annual renewal process well in advance of the deadline, and to ensure that professional liability insurance is in place before beginning the renewal process.

Ahmed is getting ready to retire from physiotherapy practice. They called the College wanting to know what professional liability insurance they are required to hold after they retire.

The personal professional liability requirement is directly tied to Ahmed’s registration status with the College of Physiotherapists of Alberta and their annual practice permit. Once Ahmed retires from physiotherapy practice, they are no longer required to hold a practice permit, and will likely cancel their registration. Once that happens, the insurance requirement established by the College no longer applies to them.

However, from a risk management perspective, Ahmed may wish to investigate “extended reporting coverage”, sometimes referred to as “tail coverage”. This coverage provides Ahmed with professional liability insurance if a patient decides to sue them for malpractice after they have left practice and are no longer a regulated member.

Patients have several years to file a claim, so having extended reporting coverage may be of benefit to Ahmed.

Other things to know about extended reporting coverage:

  • Some insurance providers include extended reporting coverage as part of their insurance policies automatically, while other companies require that the physiotherapist purchase this separately.
  • Some insurance companies stipulate that extended reporting coverage is not renewable and provide the physiotherapist with a single opportunity to purchase coverage for the full period desired.

Ahmed will need to carefully consider their insurance needs and review the terms of their professional liability insurance policy to understand what coverage is already in place and what additional coverage they may wish to purchase.

Anita is on maternity leave, however they decided to maintain their registration and annual practice permit with the College of Physiotherapists of Alberta. Anita was surprised when they were contacted by the College following the annual insurance audit and advised that they did not have the proper insurance in place. Anita’s insurer had told her that the extended reporting coverage included in their last insurance policy protected them while on maternity leave.

Insurance policies that include extended reporting coverage as part of the policy terms do typically provide coverage against claims brought against a physiotherapist while they are on leave, including maternity leave, paternity leave, or long-term disability. The information Anita had been provided by their insurer was technically correct, they did have coverage while on leave for claims brought forward related to professional services Anita provided before they went on leave.

However, Anita is a registered physiotherapist with an active practice permit. As a physiotherapist on the General Register Anita can return to practice at any time, taking on volunteer work or casual shifts if they wish. Therefore, even though they are on maternity leave and not providing physiotherapy services, they are still required to personally hold professional liability insurance.

Physiotherapists who are preparing to go on leave, for any reason, need to decide whether they wish to maintain or cancel their practice permit. If they choose to maintain their practice permit, they need to meet all the registration requirements. If they opt to cancel their permit, they need to understand the implications of doing so. People who are faced with this decision may wish to listen to the College’s podcast on this topic.

Anita’s situation brings up another important point – insurance companies are experts on the topic of the coverage their policies provide. However, when it comes to the individual professional liability insurance requirements that a physiotherapist needs to meet as a condition of their practice permit, the expert is the College of Physiotherapists of Alberta. Physiotherapists who are unsure what insurance they require to comply with the College’s registration requirements should contact The College of Physiotherapists of Alberta.

Closing comments

The College of Physiotherapists of Alberta often hears from individuals with questions regarding other insurance instruments, and whether they need to purchase insurance coverage in addition to the professional liability insurance. Physiotherapy business owners may wish to consider purchasing commercial general liability, business interruption, or cyber and technology insurance. Individuals operating home-based or mobile physiotherapy businesses may also wish to speak to their insurance providers about additional auto or home insurance to ensure that their personal and business insurance needs are met. The College of Physiotherapists of Alberta cannot provide any advice on these types of insurance instruments. Physiotherapists with questions about other insurance products need to direct those questions to their insurers.

Page updated: 20/01/2023