The nature of the NEMT (non-emergency medical transportation) business makes it impossible to run the business without the requisite insurance policy covers. No customer would patronize your services if you don’t have some of the basic insurance policy covers in place.
So, if you are looking towards starting a NEMT company, then you should create a robust budget for different types of insurance policy covers. The fact that you are going to be operating in the healthcare and transportation industry means that you would need a wide range of insurance policies.
What Type of Insurance is Needed for NEMT Transportation Business?
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General Liability Insurance
General liability insurance is required by law in most states for all businesses. This insurance protects other drivers from suffering financial losses when the driver of your ambulette causes an accident. Also, note that this insurance helps pay for injuries and damages to other people when your ambulettes are at fault for an auto accident. This business coverage comes in two specific pieces: Bodily injuries and property damages.
Bodily Injury: note that when your ambulette causes an accident, the bodily injury portion of your liability insurance caters to the cost of medical care for the victims involved. Have it in mind that this coverage pays the medical bills and other expenses that are created for other drivers and passengers, not in your ambulette.
It also pays for the expenses incurred for rehabilitation, physical therapy, and recuperation. It goes further to cater to the victims for pain and suffering, and if applicable it pays for lost wages due to time off work. When accidents cause fatalities, this coverage also pays for the victim’s funeral expenses.
Property Damage: If your ambulette driver is at fault for an auto accident, the property damages portion of your liability insurance will cater to the cost of repairs that the other vehicles need.
Business Auto Insurance
Business or commercial auto insurance covers the general requirements that are relevant to running a NEMT business. Auto insurance protects your company against any medical, hospital, or emergency transportation expenses that should arise out of injuries sustained during an accident or other mishap for which your company is liable.
Medical Payments Insurance
This insurance protects your ambulette drivers and all the staff and clients who are in the vehicle at the time of an auto accident. If anyone is injured, irrespective of who is at fault for the accident, medical payments coverage will cater for the associated medical bills. You should call a licensed insurance agent to determine if you need this coverage.
Physical Damage Insurance
This is the insurance coverage that protects your ambulettes directly. If your NEMT ambulette is damaged or destroyed due to unexpected events and perils, this coverage will ultimately cater to the repairs and replacement of your ambulettes.
This is quite crucial for NEMT ambulettes that are not fully paid for, and those that are leased, because it provides the highest level of loss protection your company can get. This insurance package comes in different types;
Comprehensive Physical Damage: This damage protects your ambulettes against a wide variety of potential day-to-day risks. It also protects you against theft of your ambulettes; break-in, vandalism, damages caused by natural events such as a hail storm, and more. This damage protection covers most damages that are not caused by overturning or by collision.
Collision Damage: Collision damages provide you with insurance for those times when your ambulettes do get damaged in a roll-over or collision. If, for instance, your ambulette backs into a mailbox while picking up customers, your collision damages protection will pay for the cost of repairs.
Specified Peril (CAC): This specified peril insurance provides you with protection against only those events and risks that are specifically listed on your driving school vehicle insurance policy. It is also known as CAC, which is short for Fire and Theft with Combined Additional Coverage.
Uninsured or Underinsured Motorist
According to experts, this insurance is ideal for your NEMT ambulette transit service because it protects you from suffering financial hardships that can be caused by other people. If another driver causes an accident with your ambulette and they do not have insurance – or they don’t have enough insurance – this coverage caters to the cost of repairs to your ambulette and pays for the bodily injuries of your driver and passengers.
Even though general liability insurance protects your business from accidents, it usually doesn’t cover damages that you had the power to avoid. It simply means that a lot of workplace injuries are not covered. In a worst-case scenario, an employee could litigate for the injuries they incurred in the workplace, and that is where workers comp insurance is the most useful.
Note that if an employee ends up with medical expenses from a workplace accident, workers’ compensation insurance can pay them for the time they were out of work, as well as their medical costs. In return, the employee forgoes the right to sue the employer.
Have it in mind that this is a mutually beneficial solution, and it is usually the easiest and quickest one as well. Without workers comp in place, you might end up with a month-long legal battle that will drain the wallets of both the business and the defendant.
Other Commercial Auto Coverage You May Want to Consider Include:
Rental: Rental insurance pays for the cost of renting a temporary replacement ambulette when yours is down for repairs due to an auto accident.
Towing: If your ambulette is damaged extensively in an auto accident it will need to be towed to a repair place of your choice. Towing insurance will pay for that expense.
Accessories: NEMT insurance should include accessories coverage so that you do not have to pay for repairing or replacing expensive equipment you have installed. Accessories coverage can be added to your business auto insurance to protect you from the loss of devices such as GPS navigation units, communications radios, and mileage meters.
Disability insurance provides income in a situation where a business owner or employee is unable to work due to an illness or injury that occurred away from work. If an illness or injury keeps someone from working for an extended period, disability insurance provides financial assistance to replace a portion of lost income.
This type of coverage is typically available through employer-provided or voluntary employee benefits. Business insurance can also provide disability benefits with a workers’ compensation policy if an employee becomes disabled after a work-related injury or illness.
Group insurance is insurance that covers a group of people, for example, the members of a society or professional association, or the employees of a particular employer. Group coverage can help reduce the problem of adverse selection by creating a pool of people eligible to purchase insurance, which might be because they are a worse-than-average risk.
Grouping individuals together allows insurance companies to give lower rates to companies, “Providing large volume of business to insurance companies gives you greater bargaining power, resulting in cheaper group rates”. One major feature which is sometimes common in group insurance is that the premium cost on an individual basis is not individually risk-based. Instead, it is the same amount for all the insured persons in the group.
Health insurance is insurance that covers the whole or a part of the risk of a person incurring medical expenses, spreading the risk over numerous persons. By estimating the overall health risk and health system expenses over the risk pool, an insurer can develop a routine finance structure, such as a monthly premium or payroll tax, to provide the money to pay for the health care benefits specified in the insurance agreement.
The benefit is administered by a central organization such as a government agency, private business, or not-for-profit entity. According to the Health Insurance Association of America, health insurance is defined as “coverage that provides for the payment of benefits as a result of sickness or injury. It includes insurance for losses from accident, medical expense, disability, or accidental death and dismemberment”
Pension Insurance Contract
If your NEMT business employs people on a full–time basis in the United States, you must make provision for their pension. A pension insurance contract is an insurance contract that specifies pension plan contributions to an insurance undertaking in exchange for which the pension plan benefits will be paid when the members reach specified retirement age or on the earlier exit of members from the plan.
The fact that you are expected to have the required insurance in place means that you should budget enough money to carter for the insurance policy covers you would need. Trust me, it can be expensive getting all the needed insurance for a NEMT business, but the good news is that you can talk to a professional insurance broker and they will give you the best deal that will help you save cost.