The market for nurses liability insurance is generally stable and immune from the cyclical nature of the commercial general liability insurance market, say most observers.

But the profession is changing, along with the risks nurses face as they increasingly move away from acting under doctors' direct orders and toward taking on independent responsibilities that ultimately may lead to higher rates.

Although nurses may have some liability coverage through their employers and could be provided coverage if they work through staffing agencies, most obtain their own insurance coverage, often through risk purchasing groups. This is because the interests of nurses and their employers may not necessarily be directly aligned, observers say.

“The employer's policy is there primarily to protect the employer,” said Scott Kelley, senior vp and health care business leader for Marsh U.S. Consumer, a unit of Marsh Inc., in New York. “It's not unheard of, after a lawsuit is dismissed, to go after the nurses for damages also.”

By purchasing their own insurance, nurses “don't have to depend on the hospital's attorney to defend them should a claim come through” against them individually, said Michael Scott, assistant vp, underwriting, at CNA HealthPro, a unit of CNA Financial Corp. in Chicago.

An employer's policy may not protect them in cases where, for instance, they give medical advice to a neighbor outside of the workplace, they have to defend their licenses before their state nursing licensing boards, or the employer no longer exists as an independent entity because of consolidation.

Observers say these policies are relatively inexpensive. A registered nurse's policy that provides a $1 million-per-occurrence, $6 million-aggregate policy may cost around $100 in annual premium, they say. And rates are generally stable.

Nurses who buy their own policies through risk purchasing groups generally are immune to the market's cyclicality, said Mr. Kelley.

“The market conditions, whether they're hard or soft, do not really come into play on affinity-based programs. We go through risk purchasing groups, and so the experience of all the nurses we have in our program drives how the rates go, and once you reach critical mass, you're pretty much...insulated from any kind of external factors.”

“It's just one of those areas that have had a fair amount of stability over time,” said Michael Auerbach, vp of allied health and miscellaneous programs for Liberty International Underwriters in New York.

“We've seen severity creep up,” but it has been more stable “and a much slower pattern” than has been the case for other health care lines, said CNA's Mr. Scott.

And finding coverage is not a problem, said Judy Simmons, president and owner of Richardson, Texas-based Bill Beatty Insurance Agency Inc., which specializes in medical professional liability insurance. “There's certainly lots of insurance available,” she said.

Robert Allen, Jersey City, N.J.-based senior vp of U.S. medical professional liability for Torus Insurance Holdings Ltd., which specializes in large nurse staffing agencies, said agencies that have implemented best practices for credentialing and training and who “are proactive about settling their own accounts” even may be seeing rate decreases.

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However, staffing agencies that focus on high-risk areas, such as pediatrics or plastic and reconstructive surgery, “are seeing increases,” which are “typically based on experience,” he said. Mr. Allen said he estimates large staffing agencies account for about 10% of the nursing population at hospitals.

Yet the nature of the profession is changing, say observers. Mr. Kelley said there has been a “paradigm shift” since he first began working in this area in the mid-1990s. “In the past, plaintiff lawyers and some judges used to look at nurses simply as custodians” who take direction from physicians, Mr. Kelley said.

But now, plaintiffs attorneys are “looking at nurses and pursuing claims, from the perspective of nurses as clinicians” who can be held accountable for diagnosing and interpreting findings for medical administration and dosages. As one would expect, he added, with greater responsibilities “comes greater risk.”

Today, insurers will ask a few more questions on the application and delve “a little bit deeper into what nurses are doing, because we have a lot more nurses and nurse practitioners doing a lot of things they haven't done in the past,” said Ms. Simmons.

Nursing specialties with the highest average paid indemnity claims during 2006-2010 were obstetrics, neurology/ neurosurgery and plastic/reconstructive surgery, according to a report issued last month by the Hatboro, Pa.-based Nurses Service Organization, a division of Aon Affinity, in collaboration with CNA HeathPro.

“Nurses' exposure to risk is almost a direct correlation to the acuity that the patient is suffering,” said Torus' Mr. Allen. For instance, the highest severity of claims would be among obstetrics nurses. “If you're failing to properly monitor during a delivery, that could have implications of millions of dollars for an extended care plan for that compromised child,” he said.

Valoree Celona, assistant vp and product manager for health care programs with Chartis Inc. in New York, said as a result of this increasing responsibility, she anticipates that rates will start to move up during the next few years. “As the responsibilities expand, so do the liabilities in the marketplace,” she said.

Health care reform also could lead to more responsibilities for nurses. Robin Burroughs, New York-based consulting director, risk control at CNA HealthPro in New York, said, “It'll be interesting to see what happens during health care reform.”