Locum Tenens Coverage: Disability, Health, Malpractice and More

Working in medicine is unique in that the title of “physician” means many different things.

Some physicians work around-the-clock shifts in hospital emergency departments. Other physicians operate private practices and focus on primary care or preventative medicine. Some deliver babies, some treat cancer patients, and some perform invasive neuro or cardiac surgeries.

Yet, no matter what type of specialty you’re in, all physicians share one thing in common:

The ability to perform their work anywhere in the world.

Tech experts might be most in-demand in Silicon Valley. Professional actors are more sought after in LA than in Idaho. On the other side of the coin, physicians can work in any and every major city, small town, and rural part of the world.

The vast majority of physicians work full-time jobs in or near the city in which they live. But a growing number of U.S. physicians, approximately 40,000, choose to work locum tenens positions.

Working as a locum tenens physician has many benefits, but before you give up your job search or quit your full-time gig, there’s something you should consider:

What types of insurance will you need?

If you’re considering working locum tenens, here are the top five types of locum tenens insurance coverage you will need.


Which Type of Physicians Work Locum Tenens?

Locum tenens translates from Latin to “place holder.” And that’s precisely what a locum tenens position is — a temporary assignment where a physician agrees to work as a fill-in for another physician.

Accordingly, locum tenens positions can range from very short-term (less than one month) to several months, depending on the employer’s needs. These positions exist in medical practices, hospitals, clinics, and all sorts of healthcare facilities, both in the U.S. as well as internationally.

From physicians who work in primary care and family medicine to advanced practitioners, locum tenens work exists for physicians of all types. It’s just a matter of finding the position that’s right for you and being able to work when you’re most needed.

Related: What It Takes to Be a Traveling Physician

Locum Tenens Physicians are Independent Contractors

Diverse group of young doctors standing together in a hospital corridor discussing a patient's diagnosis

Aside from the short-term length of employment, there is one key difference among physicians that work locum tenens and those that do not.

Locum tenens physicians are independent contractors, and that means they’re self-employed.

As a self-employed entity or independent contractor, you are not an employee. Therefore, you will not receive a W2 tax form or have any federal or state income taxes withheld from your pay. Instead, you’ll receive a 1099 tax form, and you’ll be responsible for withholding your own taxes and paying them quarterly to your state and the IRS.

Aside from freedom and flexibility, one of the biggest benefits of being an independent contractor is deducting all your business expenses when you file your taxes. You can deduct any travel you incur for work or any equipment or supplies you buy to perform your job from your overall gross earnings.

But the downside is that you’ll also need to pay for all your own insurance policies.

Unless you’re an employee, you’re on the hook for getting your own:

  • Health insurance
  • Malpractice insurance
  • Life insurance
  • Additional insurance policies

Before you embark on your exciting new career as a locum tenens physician, make sure you have these five following types of insurance.

Related: Balancing Acts: Navigating Physician Moonlighting for Physicians in Residency & Practice

Health Insurance

You don’t have to be a physician to know how expensive healthcare and medical treatment can be. But since you are one, you know it’s crucial to have health insurance to protect your finances should you ever have a serious illness or need expensive treatment.

As an independent contractor, health insurance will not be provided for you. You’ll need your own private health insurance coverage.

The bad news is that you often have to agree to high deductibles and copays in order to get affordable private insurance.

The good news:

Multiple insurance companies exist in the state markets, making it easy to compare prices and policies. This way, you can ensure that you’re getting a fair rate for a fair amount of coverage.

How To Get Private Health Insurance

To get your own health insurance, start by visiting Healthcare.gov. There you’ll be able to view the available plans in your state and find policies that will cover you for out-of-state care. (That is, if you plan to work locum tenens in another state).

Prices vary from state to state, as do plans, which range in tiers from bronze to silver to gold.

In 2021, the average benchmark plan (which refers to a state’s second-lowest-cost silver plan) costs $443 per month per person.

The most expensive state for health insurance is Wyoming, at $782 per month. Whereas, the lowest average healthcare cost is in Minnesota, at just $292 per month.

Getting private health insurance can be costly, but it does have one significant advantage:

You can keep your plan no matter where you work.

Therefore, if you decide to work locum tenens for an extended period of time, this is the best choice. If and when you choose to become an employee again, you’ll have the option to switch over to an employer-provided healthcare plan.

Get Coverage Through Your Spouse

If your spouse has employer-sponsored health insurance, it can be much more cost-effective to add yourself onto their existing plan. This can save hundreds of dollars per month, particularly if you need top-tier coverage or need insurance in an expensive marketplace.

Life Insurance

Regardless of age, specialty, or level of experience, all physicians, including locum tenens providers, should have life insurance. And it’s not just for physicians with dependents. Though if you have dependents, it’s an absolute must.


Because your beneficiaries can use your death benefit to pay for all sorts of expenses when you’re gone. From mortgage and utility bills to future college educations or weddings, most physicians want to provide for their families and dependents, even after their death.

But there’s more to life insurance than simply leaving your spouse and kids some money when you die. With a permanent life insurance policy that offers dividends and accumulates cash value, you can build wealth and take advantage of the concept of infinite banking.

Infinite banking is a unique strategy in which you build cash value into a life insurance policy so that you can borrow from yourself at a future date. It cuts out the middleman (a.k.a. the bank). Instead of taking a loan from a bank and paying it back with interest, you borrow from yourself and pay it back to yourself.

Further reading: Term vs. Permanent: A Physicians Life Insurance Comparison Guide.

Disability Insurance

Moreover, disability insurance isn’t just another form of health insurance or a way to pay for expensive medical care. Disability insurance is actually income insurance.

Here’s how disability insurance works:

If you become ill or disabled in a way that prevents you from doing your current job (and earning your current income), you can collect disability insurance benefits through your disability insurance provider. Depending on the policy terms you choose, these benefits can pay off for two years, five years, ten years, or up until the age of retirement.

The Pros of Disability Insurance

Disability benefits usually pay about 60% of your current income, but you’ll want to be sure your policy has a true own-occupation definition of disability.

Disability insurance policies allow you to choose from various definitions of disability. You have to meet that definition to collect your benefits.

Other definitions, such as any-occupation, equate to more affordable plans. Still, those definitions are much more challenging to meet, making it quite tricky to qualify to receive your benefits.

Whether you’re self-employed or work for an employer that offers group disability insurance, it’s always best to get individual coverage. You can hold these policies for life, and you can take them with you from job to job, even if you work short-term assignments as a locum tenens physician.

The Cons of Disability Insurance

As long as your policy has the true own-occupation definition, there is no downside to having a disability insurance policy. The monthly premium is a small price to pay for the peace of mind that if you can no longer do your job due to an illness or injury, you can still earn income.

Be aware of the fine print when choosing your disability insurance. Learn more by reading: Hidden “Own-Occupation” Traps in Physician Disability Insurance.

Malpractice Insurance


Planning to work a locum tenens position in a new city or state?

Be sure to familiarize yourself with malpractice insurance coverage laws so that you know what that state requires of you.

How To Choose the Right Policy

There are a few different types of malpractice insurance policies that you can get. The most popular are the claims-made policy and the occurrence policy.

A claims-made policy means that a patient would have to file their malpractice claim during the time frame in which you held the policy.

For example, if you have a policy from January 2020 to December 2022, your insurance will only cover claims made during that time. If a patient makes a claim in June of 2023 for something that happened in 2021, you will not be covered.

The way to get around this is to add tail coverage when your policy period ends. Tail coverage extends the life of your coverage period and protects you against claims filed after your policy ends.

But there is a better option, especially for physicians working short-term locum tenens positions:

The occurrence policy.

An occurrence policy offers lifetime coverage as long as the occurrence happened during your coverage period. If you held an occurrence policy for six months back in 2019 and a patient decides to file a claim in 2021, your insurance provider will cover that claim.

Occurrence policies tend to be more expensive than claims-made policies, but they offer better protection and greater value.

Related: Mag Mutual Insurance: What You Need to Know

How To Get Malpractice Insurance as a Locum Tenens Physician

It’s always possible to get medical malpractice insurance through private insurance carriers. However, if you found your locum position through a locum staffing agency, they can also help you secure a malpractice plan.

Some locum tenens staffing agencies only offer claims-made policies with tail coverage, but it’s worth asking if they do.

At some locum staffing agencies, the cost of a claims-made policy with tail coverage is baked into the position’s pay rate. If you intend to get your own private malpractice coverage, you may be able to use this as a bargaining chip to negotiate a better pay rate.

Renter’s Insurance

Some physicians who work locum tenens for a short time choose to lodge in a hotel while they’re on assignment. But for jobs that last a few months at a time, renting an apartment or a house is a viable option.

If you intend to rent a place to live while working locum tenens, be sure to protect yourself with renter’s insurance. Even if you rent a fully furnished apartment, renter’s insurance will protect your personal property.

Fires and floods can happen at any time. For a few dollars per month, renters insurance can help you recoup the cost of any goods that need replacing after damage, destruction, or even theft.

The Benefits of Working Locum Tenens

Locum tenens jobs offer lots of unique benefits, such as the

  1. opportunity to travel.
  2. chance to live in a new place.
  3. experience of practicing medicine in underserved communities with physician shortages.

As a locum tenens physician, you can seek out an opportunity that allows you to work full-time or part-time. The flexible schedules and short-term assignments offer the option to earn a significant salary while maintaining a work/life balance and finding avenues for personal fulfillment.

Many retired physicians choose to take on locum tenens positions as a way to bring in additional income after they’ve retired. Yet, locum tenens positions can be quite beneficial for young physicians as well.

Locum tenens jobs give young physicians a unique networking opportunity. They provide a chance to work in a new setting, so you can test out various workplace formats, to see which you prefer best.

Just make sure that before you accept a locum tenens position, you have the proper types of insurance in place to protect you, your family, and your assets.

Even though locum tenens contracts are temporary assignments, many of them include restrictive provisions that prevent you from entering into contracts with other local companies. Our contract review services will ensure that you maintain the right to pursue other long-term opportunities in the area if you choose.


Occurrence-based locum tenens malpractice insurance will protect you against patient claims.

Private health insurance will help pay for exorbitant medical bills should you fall ill.

With disability insurance, you can protect your future income.

life insurance policy that accumulates cash value can provide benefits for your loved ones and build wealth for your future.

Whether you work a full-time job or are considering taking on a locum tenens position, all physicians need these four main types of insurance.

For guidance on finding the right insurance policies and the best providers, contact Physicians Thrive now.

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