Pharmacist & Pharmacy Business Insurance: Cost, Overview & Quotes From $5

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If you work in industries like massage therapy or acupuncture, you’re opening yourself up to a lot of liability because you are working on people’s bodies. Bodily injury claims are relatively common in any healthcare industry, and unfortunately, working in the pharmacy industry is very similar.

One of the main reasons why pharmacists need to make sure that they have the right insurance is to keep themselves protected from unfortunate situations in which clients may attempt to come after them for damages. In this guide, we’re going to talk about what you need to know about pharmacist insurance.

Pharmacist Liability Insurance

Pharmacist and pharmacy general liability insurance is very essential because of the likelihood of physical injuries happening to customers.  Commonly, this insurance will take care of personal injury claims resulting from slips and falls.

Nonetheless, when it comes to pharmacies, general liability insurance doesn't only apply when a customer slips or falls. It also covers injuries caused by workplace violence and ergonomic hazards. 

Workplace violence happens when an angry customer harasses personnel of the pharmacy and sustains injuries.  On the other hand, ergonomic hazards are accidents that injure customers because of poor building design, poor building maintenance, improper arrangement of displayed products, and many more. 

In case you’re running an independent pharmacy in the neighborhood, know that customers can also sustain injuries from accidents caused by cars. The examples below will prove this point:

• Northridge - a car crashed into a pharmacy injuring a customer and shattering the front panels as a result

• New York Hospital - a car crashed into the pharmacy of the hospital after a motorbike collided with it. Four customers were injured. Three only sustained minor injuries and one suffered from a broken arm.

• Brevard, N.C. - A 70-year-old customer got pinned between the shelves of the pharmacy after a car entered the premises. 

• Chattanooga, T.N. -  A woman crashed her car into a pharmacy and sustained minor injuries as a result.

• Pleasantville - A car barreled and entered a pharmacy. One of the customers sustained injuries after the accident happened. Authorities reported that the driver of the vehicle didn’t appear drunk, sleepy, or under the influence of drugs. 

Pharmacies and pharmacists don’t face a lot of personal injury claims against their general liability coverage.   Most lawsuits customers and third parties file arise from professional negligence or malpractice. With that said, pharmacies and pharmacists should prioritize getting professional liability insurance. The next section talks about this in more detail.

Pharmacist Professional Liability Insurance

Professional liability insurance for pharmacists is an insurance policy that will take care of liability lawsuits from customers, who experienced injuries due to the wrongful and negligent actions of pharmacists.  Getting this insurance is very important as it’s very easy for pharmacists to get involved in professional liability lawsuits. The table below shows the most common allegations for professional liability as well as their increase from 2018 - 2019. 

Interestingly, giving the wrong drug to a patient or giving the drug to another patient aren’t the costliest errors pharmacists commit. Instead,  these three:

• Failure to identify overdosing - available data show that liability claims for this error require a settlement of $544,600 on average

• Preparation error - settlement fees for liability claims amount to $324,819

• Libel/slander - pharmacists committing these pay $300,000 on average

Other costly errors pharmacists find themselves paying for aside from the previous three are:

• Failure to provide instructions or giving wrong instructions - $275,092

• Errors in preventing drug/container/equipment contamination - $264,468

• Failure to counsel patient - $263,104

The cost of professional liability claims against pharmacists/pharmacies is also determined by their type. Based on available data,  liability claims against pharmacies/pharmacists in hospitals are the most expensive. Please refer below if you want to see the actual figures:

Another way to look at the cost of professional liability claims is to investigate how much pharmacists pay on average based on their license. Available data show that 96.2% of liability claims are filed against licensed pharmacists. The remaining 3.8% is filed by aggrieved parties against pharmacy technicians. Licensed pharmacists pay $127,465 for professional liability claims on average. On the other hand, pharmacy technicians only pay $20,960.

How to Mitigate the Risk of Professional Liability Claims?

The research titled Risk Management in Pharmacy: Preventing Liability Claims  provides the best ways on how pharmacists and pharmacies can avoid errors and professional liability lawsuits:

• Triple-Check-Plus-Two - done by comparing the product’s NDC number to its registered number in the computer database then showing the product to the patient and asking what the product is for

• The Two-Second Rule - not allowing products to be on display and available to customers without a label for more than two seconds

• Relieving Pressure While Working - pharmacists can sometimes skip protocols to cope up with high customer volume and so, it’s integral that pharmacists learn efficient customer management and dispel the negatives of “waiting in line”

• Use of Basket - using a basket to sort prescriptions can be useful in preventing giving a drug/medicine to the wrong patient

• Patient Education - pharmacists should build the habit of briefing the customer about the use and recommended dosage of a drug/medicine to a patient. Also, warning the patient about counterfeit products or sudden changes to the drug/medicine is also important

Related:

• EMT Liability Insurance
• Firefighter Insurance
• Insurance for Police Officers

Workers Comp Insurance for Pharmacists

Workers' compensation insurance will account for any work-related injury an employee sustains. Pharmacists who are currently employed have no use for this. However, pharmacies do. 

So, what are the most common work-related injuries in pharmacies? The common ones are musculoskeletal and needlestick injuries. 

The Center for Disease Control and Prevention provides insights into musculoskeletal injuries in pharmacies. The report suggests that uncomfortable repetitive motions when opening and closing medicine bottles triggers the development of musculoskeletal disorders such as:

• Carpal tunnel syndrome

• de Quervain tenosynovitis

• Upper extremity tendinitis

In addition,  employees participating in the study reported that they received no training that would have taught the efficient and safe opening/closing of medicine bottles. With this said, it’s safe to assume that the lack of ergonomic training contributes to the development of musculoskeletal injuries in pharmacy employees. 

CDC partnered with NIOSH to gain insights about needlestick injuries in pharmacies. Their report that studied a national retail chain in 2011 states there are 34 cases of needlestick injuries from 2000 - 2011. Needles that commonly cause injuries are lancer needles and syringe needles, and body parts that commonly sustain injuries are the palms and the fingers. In addition, needlestick injuries usually happen when:

• After use and disposal of needle

• While using needle

• While placing a needle in a container

• Disassembling the syringe

• Carelessly leaving the needle improperly disposed of

Work-related injuries can become very costly. Without insurance,  a pharmacy might have to pay millions to cover lost income and treatment of the employee.  For this reason, it’s advised that there should be workers comp insurance in place that accounts for most of the expenses of a work-related injury claim. 

An Employee Is Suing a Pharmacy for Missed Overtime Pay and Wrongful Termination. Will Workers' Comp Provide Coverage?

Unfortunately, workers comp can't cover lawsuits and settlement costs for wrongful termination and missed overtime pay.  Pharmacies need to get another insurance to protect themselves from such a situation.  Wage and hour liability insurance is the most ideal. This policy will cover lawsuits and settlement fees of a company facing accusations of violating the United States Fair Labor Standards Act. 

Pharmacy Business Insurance

Business insurance is also commonly referred to as a BOP (Business Owner Policy), and what makes these policies remarkable is that they combine several different forms of coverage at a lower rate than they would go for individually. This allows a pharmacy or pharmacist to get more comprehensive coverage than they would otherwise.

As you may expect from the name, a BOP is only really useful to business owners and not to individual pharmacists because the kind of coverage that comes with them typically applies to the business as a whole. The most common form of coverage included in a BOP is some form of liability policy.

This can be either a public or general liability policy, but you’ll get it for a relatively good price compared to getting it individually. Another frequent component to these kinds of policies is a commercial property insurance policy, which will cover your property from any damages sustained that weren’t due to your negligence.

Keep in mind that business policies can vary from carrier to carrier, and there’s no guarantee that any two of them will be the same. For example, some business owner policies will come packaged with employers’ liability pharmacy insurance bundled in as well, though they’ll cost a bit more.