Posted by Amy Carbone on Feb 3, 2025 9:34:06 AM
Navigating dental practice ownership expands beyond dentistry. From finding the best lender or bank for loans to choosing a CPA, law firm, or other professional services, your knowledge base needs to be broad.
As a practice owner, you'll need several types of dental practice insurance to cover the what-ifs of business ownership and operation, effectively managing your risks and helping you to secure what’s most important.
Do You Need Dental Practice-Specific Insurance?
Fundamentally, insurance policy types are the same. However, dentistry is a field different from most other business types.
Obtaining dental practice insurance from experienced advisors who work only with medical and dental practitioners and practices may ensure that your insurance policies are tailored to address your practice's specific needs and risks of your practice.
Here are five types of dental office insurance to consider if you own or plan to own a practice:
5 Types of Coverage To Consider
1. Business Owners’ Policy
A business owner’s policy for your practice is similar to a homeowner’s policy for your home in that it combines a number of important coverages into one policy. Included in its most basic form is typically insurance to cover your business property and business liability exposures. Dental business owners' policies are customizable to meet the needs of your individual practice.
What Does It Cover?
Business owners’ policies cover four major categories of business ownership:
Property
Property insurance covers the building and personal property inside, including but not limited to external structures, dental and office equipment, furniture, and fixtures. You should keep a current estimate of all property costs on hand to provide to your insurance company in the event your property is damaged.
General Liability
General liability insurance generally covers claims made against your dental practice as a direct result of normal operations. Examples may include personal injury, medical payments, and certain claims for damages to premises rented to you. It is important to note that a general liability insurance policy does not provide coverage for malpractice-related claims.
Business Interruption
An unexpected incident can interrupt your ability to generate revenues. Insurance can reimburse for loss of earnings resulting from a loss of covered property. One such example is in the event that a fire damages your office.
Employment Practices Liability Insurance
Employment practices liability insurance helps protect dental practice owners from claims made by employees who accuse the practice of workplace discrimination, wrongful termination, sexual harassment, and other matters of employment law.
Why Does Your Dental Practice Need It?
Package policies like business owners' insurance can offer you multiple types of protection at a lower cost than purchasing each individual policy. You'll also have peace of mind knowing that you're covered on the basics. Further, landlords and creditors often require that you maintain a Business Owners Policy.
2. Business Overhead Expense Disability Insurance
The benefits from an individual disability income insurance policy may safeguard your personal finances if you are unable to work, but what about the monthly expenses at your practice?
What Does It Cover?
In the event the owner becomes disabled, business overhead expense disability insurance may help cover many of the fixed operating expenses, such as office rent, payroll, utilities, etc.
Why Does Your Dental Practice Need It?
While your personal disability insurance policy is intended to supplement your personal income in the event of a disability, business overhead expense insurance helps pay the fixed operating expenses of your practice so that upon return, you return to a ready practice. If the nature of the disability dictates that you will not return, having the ongoing expenses covered allows you to pursue a buyer for your practice.
3. Business Loan Protection Disability Insurance
When you open or operate a dental practice, you may rely on one or more loans. Business loan protection disability insurance may help protect you and your practice in the event you are out of work due to illness or injury. Depending on the insurance company, this type of policy may be a stand-alone policy or a rider on a business overhead expense disability insurance policy.
What Does It Cover?
This coverage helps ensure payments are made for practice acquisition, equipment purchases, expansion, or any other type of business loan you may have, offering financial continuity during a time of uncertainty.
Why Does Your Dental Practice Need It?
Some business lenders require business loan protection insurance. However, even if it’s not a requirement, it may still be a smart choice. If you’re unable to work due to disability, keeping up with loan obligations could become a serious challenge. Without business loan protection, you may need to tap into personal savings or take out additional loans — outcomes that can jeopardize your financial stability and the health of your practice. Business loan protection disability insurance offers peace of mind, knowing that your practice won’t be burdened with loan payments you can’t afford while you focus on recovery.
4. Entity Malpractice Insurance
There are two types of dental malpractice insurance. Entity malpractice coverage typically covers malpractice claims made against your dental practice, as opposed to your personal malpractice insurance, which generally covers claims made against you.
What Does It Cover?
Entity malpractice insurance provides protection in the event that your practice entity is named in a lawsuit. Like an individual malpractice policy, an entity malpractice policy may provide coverage for any defense-related costs as well as any awards.
Why Does Your Dental Practice Need It?
Without entity malpractice coverage, you may be held personally liable for lawsuits against your dental practice. Depending on the circumstances, this may cause serious financial hardship for the practice owner.
5. Data Breach Insurance
A data breach can be costly for your dental practice if sensitive patient data and financial information are compromised. Data breach insurance helps cover the cost of getting back up and running after a data breach and compensating victims of the breach for financial damages they may have suffered as a result of their information being leaked.
What Does It Cover?
Data breach insurance may cover related expenses, such as:
- Public relations
- Credit monitoring
- Good faith advertising
- Legal fees
- Notification services
- Damage awards
Why Does Your Dental Practice Need It?
Without data breach insurance, your dental practice could be left to absorb the cost of the breach. Depending on the scope of the data breach, your practice may suffer a serious financial impact. Data breaches are common, and dental practices are a hot target for hackers, so it's critical to protect your patients and practice.
Protect Your Business With Comprehensive Dental Practice Insurance Coverage
While these types of insurance coverage may not meet all your dental practice needs, they're excellent places to start if you want to protect your practice — and yourself — from the kinds of catastrophic events that could be detrimental to your business. At Treloar & Heisel, we provide comprehensive insurance policies tailored to small and medium-sized dental practices. We understand your industry and are able to suggest the insurance products that are the right fit for the needs of your business.
To learn more, download your complimentary copy of The Practice Owner’s Guide to Business Coverage and learn more about insurance coverages to protect your practice.
About Treloar & Heisel
Treloar & Heisel, an EPIC Company, is a premier financial services provider to dental and medical professionals across the country. We assist thousands of clients from residency to practice and through retirement with a comprehensive suite of financial services, custom-tailored advice, and a strong national network focused on delivering the highest level of service.
Insurance products offered through Treloar & Heisel, LLC.
