Physical Therapist Business Insurance (2025)

Physical therapist business insurance helps protect you and your practice if something goes wrong on the job. For example, if a client claims your treatment caused an injury or worsened their condition, the insurance can help cover the costs.

It also protects you from other risks, like legal fees if you’re sued, or expenses related to professional mistakes. This kind of insurance helps keep your physical therapy practice running smoothly, even when unexpected issues arise.

Why Do Physical Therapists Need Insurance?

Physical therapists need insurance to protect against many things, not least of which is malpractice and negligence claims particularly because of the inherent risk of unintended accidents with physical therapy. Without the right insurance, a physical therapist might be on the hook for defending themselves in a lawsuit costing potentially thousands of dollars.

Then you add the risk of non-medical liabilities especially if a physical therapist operates a clinic or owns their clinic with the added risk of things like slip and fall accidents, where general liability insurance could provide protection for the business from claims of property damage, bodily injury, or even lawsuits.

It also adds credibility, many clients require proof of insurance before hiring a physical therapist. Whether you’re a solo therapist or run a clinic, having the right insurance helps you operate confidently, knowing you’re covered if something goes wrong.

What Insurance Do Physical Therapists Need?

Physical therapy is a hands-on profession that involves inherent risks. You spend your days helping clients improve their mobility and health, but accidents can happen anywhere. This is true whether you work in a clinic or visit patients at their homes. You need the right coverage to protect your livelihood from expensive lawsuits or property loss.

Here are the key insurance policies physical therapists should review to keep their business safe.

General Liability Insurance

This is the starting point for most small business protection. It covers accidents that involve third parties, such as your patients or delivery drivers. If someone gets hurt on your property or you accidentally damage their belongings, this policy pays for the damages. It handles legal fees and medical bills so you do not have to pay out of pocket.

Example: A patient trips over a loose rug in your waiting room and breaks their wrist. They sue you for the medical costs. General liability would pay for their hospital bills and your legal defense.

Business Owner’s Policy (BOP)

A Business Owners Policy is a convenient package that bundles two major policies together. It usually combines general liability and commercial property insurance. Insurance companies often offer this bundle at a lower rate than if you purchased the policies individually. It protects your business assets and covers liability claims at the same time.

Example: A pipe bursts in your office overnight. It ruins your flooring and forces you to close for a week. A BOP helps pay for the repairs and the income you lost while closed.

Professional Liability Insurance (Malpractice)

This is arguably the most critical coverage for a physical therapist. It protects you if a patient claims your professional services caused them harm. This includes errors in treatment, negligence, or failing to provide the right advice.

Example: You perform a manual adjustment on a patient, and they claim it caused a herniated disc. They sue you for malpractice. Professional Liability insurance covers the settlement costs. Physical therapists typically pay between $89 and $1,500 per year for this specific coverage.

Workers’ Compensation Insurance

Most states require this insurance by law as soon as you hire your first employee. It protects your staff if they get sick or injured while performing their job duties. It pays for their medical care, physical rehab, and lost wages while they recover.

Example: A physical therapy assistant strains their back while helping a heavy patient move from a wheelchair to a table. Workers’ compensation pays for their doctor visits and time off work.

Commercial Property Insurance

This policy protects the physical location of your business. It covers the building itself and the contents inside against perils like fire, theft, vandalism, and storms. Commercial Property insurance is essential for anyone who owns or leases a dedicated clinic space.

Example: A severe lightning storm starts a fire that destroys part of your roof, and the smoke damages your reception area. This policy pays to repair the building structure.

Business Personal Property (BPP) Insurance

While property insurance covers the building, BPP covers the movable items you use to run your business. This includes your therapy tables, resistance bands, weights, computers, and furniture. It pays to repair or replace these items if they are stolen or destroyed.

Example: Someone breaks into your clinic and steals your office computers and several pieces of expensive ultrasound equipment. BPP insurance provides the funds to replace the stolen gear.

Cyber Liability Insurance

Physical therapists store sensitive patient data and health records. This makes your business a target for digital criminals. Cyber liability insurance helps you recover from data breaches and cyberattacks. It covers the cost of notifying clients, legal fees, and credit monitoring services.

Example: A hacker gains access to your scheduling system and steals patient credit card numbers. This policy helps you manage the legal and financial fallout.

Commercial Auto Insurance

Personal car insurance policies rarely cover accidents that happen while you are driving for work. If your business owns vehicles, you need commercial auto insurance. It covers liability and vehicle repairs if you or an employee gets into a crash.

Example: You are driving the company van to a patient’s house for a session and rear-end another car. This policy covers damage to both vehicles and any medical needs. On average, a physical therapy business pays around $138 per month, or $1,652 per year, for this coverage.

Hired And Non-Owned Auto (HNOA) Insurance

This coverage is for vehicles your business uses but does not own. It applies when you or your employees drive personal cars or rented vehicles for work tasks. It provides liability protection that personal auto policies may deny.

Example: You ask your receptionist to drive their own car to the store to buy office supplies. They hit a pedestrian in the parking lot. HNOA covers the liability claim against your business.

Umbrella Insurance

Standard insurance policies have financial limits. Umbrella insurance provides an extra layer of safety when a claim exceeds those limits. It sits on top of your general liability or auto policies to cover massive settlements.

Example: A patient sues you for $1 million after a severe injury at your clinic, but your general liability policy only covers up to $500,000. Umbrella insurance pays the remaining $500,000, so you do not go bankrupt.

Cheapest Physical Therapist General Liability Insurance

The cheapest option for General Liability Insurance is offered by biBERK, with policies starting at $415 per year.

Note: These estimates are based on standalone General Liability policies, which cover third-party bodily injury or property damage (e.g., a patient slip-and-fall). Actual premiums will vary based on your clinic’s size, location, and desired liability limits.

Cheapest Physical Therapist Business Owner’s Policy

The cheapest option for a Business Owner’s Policy (BOP) is The Hartford, with average annual premiums around $498.

Note: These estimates are based on a Business Owner’s Policy, which packages General Liability and Commercial Property insurance (protecting your equipment). Actual premiums will vary based on your location, the value of your business property, revenue, and specific coverage add-ons.

Cheapest Physical Therapist Professional Liability Insurance

For Professional Liability Insurance, Hiscox is the cheapest option, with average annual prices starting at $341.

Note: These estimates are based on standard Professional Liability (Malpractice) policies for a small physical therapy practice. Actual premiums will vary based on your specific services, location, revenue, and chosen coverage limits.

How Much Does Physical Therapist Insurance Cost?

Physical therapist business insurance typically costs between $500 and $1,500 per year, depending on many factors, particularly whether you work as an independent physical therapist or run a clinic, and if so, how large that clinic is. For solo providers with no employees, rates can fall at the lower end of this range.

However, if you offer a large-scale physical therapy clinic with multiple employees, you have vehicles for work, or you need to add things like commercial property insurance, your premiums could be higher, sometimes exceeding $2,000 annually.

Several factors influence the cost of coverage, including your business location, the number of employees, the types of services you offer, the records you keep (HIPAA requirements might necessitate additional coverage for things like cyber protection), your claims history, and whether you transport expensive equipment.

Insurers also consider the amount of coverage you choose and whether you package policies together. While it may be tempting to go with the cheapest option, it’s important to choose a plan that truly protects your business from its most likely risks.

Note: These figures are estimates for a small physical therapy practice. The estimates are based on policies with standard coverage limits and deductibles. Your actual premium will vary based on several factors, including your practice’s location, number of employees, annual revenue, specific services offered, and your claims history.

How Is Your Physical Therapist Insurance Cost Calculated?

Insurance companies analyze several specific details to set your premium rates. The size of your practice is a primary factor. A solo therapist usually pays much less than a clinic with a full staff.

The specific treatments you provide also impact the price. If you offer high-risk services or extensive medical care, your rates will likely be higher. Your location is another key element because costs change depending on your state and city.

Underwriters also review your claims history closely. You may be viewed as a higher risk if you have filed claims in the past. The value of your medical equipment and whether you use company vehicles affect the price as well. Finally, your business structure and the coverage limits you select will determine the final cost.