State Disciplinary Coverage
Risk Management

Understanding State Disciplinary Coverage

State disciplinary coverage is an important feature of your malpractice coverage. You may have easily overlooked it, not realizing you have it, and the value.


State disciplinary coverage is an important feature of your malpractice coverage. You may have easily overlooked it, not realizing you have it, and the value.

State disciplinary actions are defined as a covered proceeding in your PSIC professional liability policy. The limits are considered supplemental, which means they are separate from your policy limits. Your policy provides you with a $25,000 legal expense limit per policy period for covered proceedings.

When

Coverage comes into play when the covered proceeding is initiated, and the initial act giving rise to the action occurs on or after your specific effective and/or retroactive date, and prior to the termination of the policy.

What

In simple language, we will provide you with defense counsel to help you navigate the choppy waters of a dental board investigation. The policy does not require the action to be part of a malpractice claim, or lead to a malpractice claim – it simply requires notice of an investigation.

The policy will not pay for any sanctions, penalties, fines, damages, settlements or assessments. It will also not apply to any criminal actions or legal expenses arising out of actual or threatened sexual abuse or related grounds. Always be sure to read your policy for clarification or additional information.

Your Obligation

As the insured, you must provide us written notice that a proceeding has been initiated. Upon receipt, we have the duty and right to defend you (the insured), appoint counsel and investigate the allegations. 

State Board Obligation

State boards as well as professional associations must report certain disciplinary actions based on professional competence or conduct to the NPDB (National Practitioner Data Bank). Particular actions they may report include license revocation, suspension, restrictions, censures, reprimands and probations. A report to the NPDB, which will be on your license for the rest of your professional life, may not be the only adverse outcome. There is the potential for collateral damage: loss of third party payer contracts, exclusion from participating in Medicare/Medicaid or other Federal or State health care programs and a denial of malpractice coverage.

Bottom Line

Remember to protect your license at all costs. Exchanging emails and documents may not be enough, and is not advisable when a state disciplinary action is brought to your attention. If you receive notice of a board investigation, waste no time in contacting PSIC and talking with a claims representative. If you missed the recent issue of the Dental Connections, you can review this issue here: https://www.psicinsurance.com/dentists/risk-management/dental-insights/adverse-occurrence-reporting.aspx which details more information on disciplinary actions.

We are here to protect your reputation. It is what we know; it is what we do.


The information in the NCMIC Learning Center is offered solely for general information and educational purposes. It is not offered as, nor does it represent, legal or professional advice. Neither does this information constitute a guideline, practice parameter or standard of care. You should not act or rely upon this information without seeking the advice of an attorney familiar with the specific legal requirements of the state(s) in which you practice. If there is a discrepancy between the site and an insurance policy you have with NCMIC, the policy will prevail.