Types of Insurance You Should Have in Your Practice
When running a business, especially for the first time, we typically overlook many of its moving parts that have the potential to cause problems later.
Some of the main things people often forget to consider are proper business registration, budgeting for taxes, contracts and service agreements, and even things related to marketing, such as a professional brand kit or setting up a Google My Business Profile.
One thing that I think is very essential in business that shouldn’t be overlooked is insurance. Therapists sometimes forget, or perhaps don’t even realize, that many different types of insurance should be associated with your practice. Insurance for your practice is crucial in protecting your business, your professional license, your income, and your clients.
Any therapy practice should carry several types of insurance that are diversified in nature and that protect against legal, financial, and operational risks.
I want to break down those different types for you.
Here are the key types of insurance to consider:
Insurance For Your Team
Health Insurance
Most therapists already know of/have this one. This covers medical expenses for you and your employees. Any doctor visits, mental health care, prescriptions, and the like are covered here. While some states require that your business have health insurance if over a certain size, it’s not required, yet recommended. It allows your therapists to be healthy, therefore they can do their job effectively, promoting the continuation of business. This also tends to attract and retain employees, as health insurance is seen as very valuable
Life Insurance
This insurance can also be seen as high value to employees and potential employees, as it provides financial security to families and business partners. Its purpose is to pay out a benefit to the beneficiaries of the insured. Life is unexpected, so why not have this one?
Short-Term & Long-Term Disability
The purpose of these is to provide income stability and to replace a portion of income if unable to work either temporarily or for an extended period of time. While short-term can be essential in the stage of recovery, long-term is more focused on health issues that could potentially impact a therapist/owner’s career in general. Short-term disability insurance is especially critical for solo practitioners who rely on sessions with clients, while long-term disability insurance can be even more critical than life insurance in some cases.
General
General Liability
This covers injuries or accidents that may occur while on your property. A good example of this is when a client slips and falls on your property. It’s a good idea to have this one on hand for the things that may not be anyone’s fault, but tend to happen now and again. Anyone who has a physical location for their practice should have general liability.
Weather Policies
This policy covers lost expenses related to natural disasters such as tornadoes, floods, wildfires, etc. If you live in an area that is prone to such disasters, it’s important that you have this policy. In times when your business is forced to close, this can cover things like rent or payroll. Who doesn’t want that safety net!
Cyber Policy
As we live in the year 2025, this policy is so important to have! Any data breaches or cyberattacks will be covered with this one. Just think, you have so much sensitive information from clients stored in digital files, and it would be tragic for those systems to get tampered with. This is highly recommended for anyone who stores any health records online or conducts any kind of online/remote therapy.
Workman’s Compensation
This insurance covers lost wages or medical expenses for employees when injured on the job. Varied by state, this is required to have if you have employees.
Other
Property Insurance
This one is essential to anyone who owns or leases office space with equipment or furnishings! Property insurance covers any loss or damage to your business’s property due to things like theft, fire, or vandalism. I have one property that I rent and one that I own, so this insurance is needed for both!
Employment Practices Liability Insurance (EPLI)
This protects against employees making claims of discrimination, wrongful termination, harassment, etc. You may be thinking you don’t need this because ‘nothing like that would ever happen to you,’ but this insurance is recommended to anyone with a team or plan to grow a team. Although it’s good not to be thinking the worst, it’s essential to take precautions because once it happens, you don’t want to regret not operating from a risk management mindset.
Professional Liability
Also known as Malpractice insurance, this is to protect against errors, claims of negligence, or acts of omission in the provision of therapy services. Professional liability is essential for all licensed therapists and counselors.
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Having a range of insurance policies isn’t just a smart move– it’s essential to the running of your practice in a more effective way. Each policy covers a unique aspect of your practice. In fact, some policies are so unique that skipping one could leave open a critical gap that may cost you in the long run.
Each of these insurances/policies acts as a safety net that protects the financial health of the business and the well-being of the individuals who make up the business.
In my opinion, you can never be too safe when it comes to making sure you have all the moving parts associated with helping your business run smoothly.
Disclaimer: We are not a professional insurance agency. Please talk to a broker for more information.
Grow your practice today!
Navigating tough conversations with your team can be overwhelming, especially if you are unsure of what is the best route to take. This is why I offer a range of personalized business coaching services to help you make a plan, execute it and track the results. I offer 3-month and 6-month business consulting packages, Enneagram Training, and a Wise Practice Community Membership. Implement tracking methods for your practice today and reach out to Wise Practice Consulting if you need help getting started! Get in touch today to learn more.
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