Ten questions California physicians ask about malpractice insurance.

These ten answers cover California malpractice costs, limits, policy forms, reporting, and carrier status. Each is a starting point; the issued policy, declarations, endorsements, and actual facts control.

1. How much does malpractice insurance cost in California?

The main rating facts include specialty, county, policy maturity, limits, and individual underwriting facts. In The Doctors Company's 2014 California manual, historical mature claims-made base premiums at $1M/$3M limits ranged from $3,049 to $85,898.

The $3,049 rate applies to psychiatry in the Bay Area. The $85,898 rate applies to neurosurgery in Riverside or San Bernardino. Other examples are $8,274 for internal medicine in Los Angeles, $49,804 for OB-GYN in Orange County, and $35,273 for general surgery in San Diego.

These figures use a historical 2014 manual before credits, debits, and schedule rating. They are not a current quote, availability statement, or coverage term.

Geography can change the rate. The filed OB-GYN base rate is $67,235 in Riverside and $25,190 in San Francisco. The manual places these counties in different territories.

Remember what a base rate is and is not. It is a filed mature claims-made rate before the carrier applies the physician's individual rating facts. A final quote can be above or below the manual number.

The same manual provides rates for other clinicians. A nurse practitioner or physician assistant with separate limits uses 15 percent of the applicable physician rate. In Los Angeles or Orange County, 15 percent of the family practice rate is about $1,374.

The complete buying guide includes the five territories, county definitions, and clinician percentages.

2. What limits do I need - is $1M/$3M enough?

$1M/$3M means $1 million per claim and $3 million for all covered claims in one policy year. This is the base limit pair in the filed rate manual. An employment, facility, or payer contract can require another limit.

The filed factor for $2M/$5M limits is 1.25 times the base premium. For the Los Angeles internal medicine example, the premium is $10,343 instead of $8,274. The additional per-claim million costs about $2.07 per $1,000 of limit. In the same filing, $500,000/$1.5 million limits reduce the premium by 12 percent.

Civil Code section 3333.2 applies collective noneconomic-loss limits to provider, institution, and, in limited qualifying circumstances, unaffiliated categories. It does not set a dollar cap on economic damages. Contracts, procedure volume, shared aggregate limits, defense treatment, and actual policy terms can affect a limit decision. Read how to select a policy limit.

3. Claims-made or occurrence - which is better?

Neither form is always better. An occurrence policy covers care provided during its policy period, subject to its terms. A later claim can still use that policy.

A claims-made policy may respond to qualifying claims made and reported as its terms require for work on or after its retroactive date. Its premium can increase during policy maturity. When it ends, earlier work needs a fact-specific reporting and prior-acts analysis.

TDC's California manual uses the same rate for occurrence coverage and mature claims-made coverage. The early claims-made years can cost less than that mature rate.

Compare the expected years of practice, total premium, extended-reporting terms, and responsibility for prior care. An employment agreement can allocate a cost but cannot create a tail or accepted prior acts. Read how claims-made and occurrence policies work.

4. Why does my premium change every year when rates haven't changed?

Your rating inputs can change even when the manual rate does not. TDC's last approved California physician rate change was a 0.4 percent overall adjustment in 2014. The AMA survey shows unchanged Los Angeles and Orange County manual premiums from 2016 through 2025.

The internal medicine rate remained $8,274. The OB-GYN rate remained $49,804. California requires prior approval for a later admitted rate change.

A premium can increase because of maturity, hours, specialty class, territory, procedures, limits, claims history, or another underwriting adjustment. TDC's new-to-practice credit is 50 percent in year one, 25 percent in year two, and zero in year three. Ask the carrier to identify each changed input. Read the complete California buying guide.

5. Which rating adjustments apply?

TDC's filed California rules show how much can sit between a base rate and the final premium. The new-to-practice credit is 50 percent in year one and 25 percent in year two. Part-time work can receive 50 percent; quarter-time work can receive 75 percent. Claims-free credits run from 5 percent to 25 percent for established TDC insureds and 7.5 percent or 15 percent for eligible physicians new to the company. Approved risk-management activity can receive 5 percent or 10 percent. Schedule rating can add another debit or credit.

The conditions matter because the credits compete. The new-to-practice credit excludes claims-free, part-time, and risk-management credits while it applies. Part-time and quarter-time credits also exclude those competing credits. The filing defines the hours, claim history, group-size limits, and program requirements behind each number.

An Orange County OB-GYN has a mature base rate of $49,804. The first-year new-to-practice credit reduces it by $24,902 before policy maturity and schedule rating. At renewal, compare the old and new rating inputs. See the complete filed adjustments and examples.

A consent-to-settle provision states the mechanics of the statutory written-consent rule for covered California licensees. It matters because a qualifying payment may be reportable to the National Practitioner Data Bank and reviewed during later credentialing. California reporting under Business and Professions Code section 801.01 depends on the settlement, claim, payment, and licensee facts.

The policy language states the consent mechanics and a hammer clause can limit the insurer's responsibility after a rejection under its conditions.

Read the settlement provision before you buy the policy. Identify the consent mechanics, hammer-clause consequence, defense costs, limits, and deadline. Read about consent to settle and hammer clauses.

7. Do defense costs reduce my policy limits?

Some policies pay defined defense costs outside the liability limit. Others charge defined expenses inside an eroding limit. In a $1 million per-claim example with $200,000 of charged expenses and no other erosion, $800,000 may remain; aggregate, prior payments, definitions, and other terms can change the result.

One historical TDC filing included a 1.5 percent defense-within-limits discount. It is not a current offer or policy term. Read the defense clause before comparing premiums.

The same question applies to employer coverage. Ask the employer or broker for the controlling policy section. Read about defense costs inside or outside the limits.

8. What happens if a claim exceeds my limits?

The policy does not pay more than its applicable limit. A physician can be personally responsible for a judgment amount above that limit.

In 2026, MICRA limits noneconomic damages to $470,000 for injury and $650,000 for wrongful death, per statutory defendant category. The limits increase through 2033. Economic damages remain uncapped.

The NPDB recorded 707 California physician payment reports in 2025. The median payment was $205,000. This median is not a maximum. A serious claim with high economic damages can exceed the standard limit. Read the California payment trends.

9. Should I buy from an admitted carrier or a surplus lines carrier?

Confirm the legal insurer and placement path for each quote before comparing prices. An admitted carrier is California licensed and subject to its rate system. A surplus-lines placement follows separate statutory routes and disclosure rules; California guarantee-fund protection does not apply to a nonadmitted insurer.

Admitted insurers reported $450.3 million of California medical malpractice premium in 2025. The Doctors Company reported 42.4 percent.

Some risk profiles may be placed in the surplus-lines market. Check the insurer, placement path, required disclosure, and financial-strength-rating source. Read about admitted and surplus lines coverage.

10. Should I report an incident before there is a claim?

Report the event when the issued policy's incident or circumstance notice provision applies. A report can affect a later claim only if the form permits it and the notice meets its qualifying-event, content, recipient, method, and timing rules.

Events that can require review include a serious unexpected outcome, attorney records request, direct demand, or threat of legal action. Use the reporting method in the policy. Keep the carrier's written confirmation.

The old reporting period can close before the physician reports the event. The new carrier can then treat it as a known circumstance. Resolve the reporting requirement before the current policy ends. Read when a claims-made policy recognizes a claim.

Confirm the rating and policy terms before you buy

Confirm the carrier is admitted in California. If it is not, get the specific reason for the surplus-lines placement.
Price the next limit option before dismissing it. In the cited filing, higher limits cost less per $1,000 than the first million.
Classify the settlement provision: pure consent, consent with a hammer clause, or no consent.
Confirm that defense costs sit outside the liability limit.
On claims-made coverage, match the retroactive date and price the exit before binding.
Name every rating credit and debit. Do not accept an unexplained difference from the filed base.
Report any known qualifying event before the current reporting period ends.

These checks cover the main rate, limit, settlement, defense, reporting, and prior-care terms.

The final comparison must use the same physician, practice, services, dates, and limits for each quote.