CHAPTER 6

Make sure you’re insured as you need to be.

We know- we’ve already shared a lot of information about insurance. But there is a light at the end of this fully-insured tunnel! And so long as you haven’t fallen asleep, we only have a couple more things to say before we move onto more exciting topics like loan repayment, and retirement!

If you aren’t excited yet, you should be.

But we digress. We need to talk about insurance when it comes to everything else. You’ve already got a malpractice insurance for work, you’ve got life-insurance for yourself, disability insurance in the case of an accident or injury. But is that enough? The truth is you’re in pretty good shape if you have all of that already. However, there is a little bit more to think about to make sure that you’re fully protected.
As a fully functional adult, you are hopefully very familiar with the following types of insurance, but we will mention them briefly to make sure you are on the right track.

Health insurance: In residency, you will get this through your employer (hospital). In general, if you are healthy, you should be reasonably safe in getting one of the cheaper options available during residency.
Auto insurance: This is a legal requirement almost everywhere. Make sure your policy covers liability (you hurt someone else or damage their property), personal injury (you or your passengers get hurt), collision (your car gets messed up in an accident), comprehensive damage (your car gets messed up for other reasons, like a tree falling on it), and coverage of uninsured motorists (someone hits you who doesn’t have insurance).
Rental/Homeowners insurance:  This protects you from theft and damage to your property (in an apartment) or your home itself (if you own it). Make sure you look into any specific things that might need additional coverage based on your location (e.g. flood insurance).

What you may not have considered is an umbrella insurance policy.

This, of course, is insurance for your beautiful collection of umbrellas.

Wait, no, that’s not right… This is the insurance that covers everything else!
Umbrella insurance is a personal liability insurance that gives you additional coverage beyond policies you already have, and may also cover losses that aren’t included in your other policies.

Wake up! I know you’ve all fallen asleep, but seriously, we are not insurance salesmen in disguise and we are going somewhere with this…
Unfortunately, being a doctor may get you more attention than usual in certain circumstances, and not for good reasons. If you were involved in a car accident the other party may be more inclined to seek damages from you. If someone injures themselves at your home (unfortunately even a friend) some unscrupulous lawyer may put the idea in their head that they should get something from you. Your licensing and other provider information is publicly available and searchable. Right or wrong, people still view physicians as wealthy and this can put you at greater risk.

 So what are you to do to avoid one of these unfortunate circumstances? This is where umbrella insurance comes in. This insurance is designed to “fill in the cracks”, and cover circumstances that your other policies may not.
Specifically, umbrella insurance includes the following categories and offers coverage beyond your existing policies:

● Bodily injury liability: This covers the cost of injuries to others. It covers situations such as the following:
1. You hit a school bus and all 50 students have to go to the hospital (don’t worry, they’re fine!),
2. Your son Jimmy slides into home and breaks the catcher Johnny’s leg in a Little League game
3. Your lovely dog Fido bites your neighbor’s hand and he’s one of the state’s top neurosurgeons
4. Your good friend Joe drinks too many beers and falls off your deck and breaks his back, or
5. You get distracted while jet skiing and crash into a pier full of tourists.

● Property damage liability: This covers damage or complete loss of another person’s property. It covers situations such as:
1. You get distracted and drive your car off the road into a local Starbucks franchise,
2. You decide to do your own yard work which ends with a tree falling on the power lines and starting a fire that burns down your neighbor’s house,
3. Your son Jimmy, taking a break from Little League, devotes more time to his studies and accidentally blows up the school science lab, or
4. Your town sues you for the cost of reconstructing the pier you destroyed with your jet ski.

● Other liability: This includes other sources of liability such as slander and libel, among other uncommon situations (false imprisonment, malicious prosecution, mental distress). For example, let’s say you really don’t like your local Starbucks franchise. You stand outside shouting negative things about the location and you also publish a number of negative reviews online. They could potentially sue you for slander and libel respectively for these actions.

We know that some of these examples are a little bit ridiculous. But take it from us as emergency physicians, weird stuff does happen! Freak accidents, random altercations and human idiocy abound in our line of work! Additionally, in America anyone with an idea and a decent lawyer can take a shot at you (legally speaking). Just because a lawsuit is stupid doesn’t mean you don’t have to hire a lawyer to defend you.

And that’s the point of insurance. You are trying to protect yourself from something unlikely, but potentially ruinous. You are buying peace of mind that protects you in the unlikely event of an unlikely event!

Due to the nature of what umbrella insurance covers, it is also relatively cheap- $100-$300/year gets you at least $1 million in coverage. Good deal!

So as a resident, do you actually need umbrella insurance? The short answer is: maybe. It really depends on your situation. To determine whether you need umbrella insurance and to learn more about policies, find a copy of our book Advanced Wallet Life Support: How to Resuscitate Your Finances (And Your Sanity) During Medical Training and flip to Chapter 6.