Most carriers offer several choices of policy limits. The first, per-claim limit, may range from $500,000 to $5,000,000. The second, annual aggregate limit of liability, is usually equivalent to  two to three times the per-claim limit. The aggregate represents the total amount of insurance available to policyholders for all claims reported during each policy period. With increasing frequency and severity of claims, most policyholders maintain limits of at least $1-million per claim/$3-million annual aggregate. High-risk specialists generally are advised to carry limits of $2-million per claim/$4-million annual aggregate or more.

Some companies include the costs of defense within the per claim or aggregate limit. This diminishes your insurance. A doctor with a $500,000 limit would have little or no coverage to pay a judgment or settlement if much or all of the limit is exhausted by the defense costs. Complicated malpractice litigation, including trial, can easily run up defense costs exceeding $250,000. If a policy places defense costs within the limits, purchase higher limits or buy coverage from a company whose policy provides unlimited defense coverage.