Insurance for Psychologists

Professional liability insurance for psychologists is reasonably priced as psychology is considered to be a low risk category, with just 2% of psychologists are ever sued for malpractice (according to the American Psychological Association (APA). This compares with an average of 7% for all medical professionals.

The impact of a malpractice lawsuit however, can be just as devastating for psychologists as it can for any medical professional, especially a sole practitioner – Even unsuccessful lawsuits consume valuable time, energy, and they can be incredibly stressful.

Without insurance coverage, you have the added worry of the possibility of financial devastation.

Psychologists Professional Liability Insurance can include:

Covers malpractice claims related to therapy, assessment, and psychological testing.
Protection for failure to diagnose, boundary violations, and harm due to clinical misjudgment.
Applies to individual, couples, family, and group therapy in private or institutional settings.
Includes liability for test interpretation errors, consent disputes, and failure to prevent harm.
Limits up to $1M per claim / $3M aggregate; tail and retroactive coverage available.

More information

Why do Psychologists need Insurance?

The US is becoming an increasingly litigious society and both the number of claims and the awards to plaintiffs are increasing across the board.

A recent report by CNA found:

The cost of counselor malpractice claims has almost doubled in recent years: $7.8 million was paid over the 5-year study period, compared with $8 million paid during the previous 10 years.
The average total cost of a malpractice claim is $113,642.
43.9% of malpractice claims involved allegations of sexual/romantic relationships.
The average cost of defending a license was $5,454 a 46.3% increase from 2014.
There was a staggering increase of 456% in deposition assistance and record request matters since 2014.

Covers allegations of misdiagnosis, inappropriate treatment recommendations, or improper assessment protocols.
Legal defense for failure to prevent self-harm or violence, breach of duty to warn, or missed referrals to psychiatrists or emergency care
Includes protection for boundary violations, dual relationships, and ethical complaints tied to therapy practices
Applies to psychologists providing individual therapy, couples or family counseling, neuropsychological testing, and behavioral interventions.
Suitable for providers in private practice, schools, inpatient programs, correctional settings, and teletherapy platforms
Optional endorsements available for those performing forensic evaluations, disability assessments, or court-ordered services.
Also covers charting errors, informed consent issues, and disputes related to HIPAA compliance or custodial evaluations.
Coverage limits are typically $1,000,000 per claim / $3,000,000 aggregate, with options for tail coverage, prior acts protection, and multi-site practice across states or settings.