The financial and legal landscape for physical therapy professionals has grown increasingly treacherous, marked by a sharp climb in professional liability claim costs, mounting licensure defense matters, and heightened risks associated with core clinical practices. According to the newly released Physical Therapy Professional Liability Claim Report: 5th Edition, the average total incurred cost for professional liability claims involving physical therapy professionals has surged by 20.3% to reach $162,174.
Published jointly by Healthcare Providers Service Organization (HPSO)—part of the Healthcare division of Aon Affinity, the affinity business of Aon plc—and CNA, the comprehensive report sheds light on the evolving professional liability exposures facing physical therapists, physical therapist assistants, and practice owners. Beyond financial metrics, the analysis dives deep into prevailing claim trends, licensure defense issues, detailed case studies, expert analysis, and actionable risk management insights designed to help practitioners navigate an increasingly complex operational environment.
The escalation in claim severity is further underscored by a notable shift in the distribution of payouts. The report reveals that the share of claims closing in the higher indemnity range—specifically between $250,000 and $749,999—has risen significantly from 9.3% to 13.7% since the evaluation of the previous dataset. This upward migration in payout sizes indicates that when legal actions against physical therapy providers do succeed or reach high-value settlements, the financial ramifications are substantially heavier than they were just a few years ago.
Industry leaders attribute these shifting risk dynamics to a combination of clinical complexities and a changing regulatory environment. Jennifer Flynn, vice president of risk management for Healthcare Providers Service Organization, emphasized the dedication of practitioners while acknowledging the hurdles they face in modern healthcare settings.
"Physical therapy professionals are committed to delivering safe, effective care that helps patients function at their best; however, they practice in an environment marked by increasing complexity and evolving risks," said Flynn. "This report is designed to provide physical therapists, physical therapist assistants, and practice owners with insights and strategies to help minimize their unique professional liability exposures."
The report’s extensive findings point to several critical areas where physical therapy professionals face heightened vulnerability. Among these are risks closely tied to manual therapy techniques, patient monitoring protocols, injury management during treatment sessions, practice-level claims, and the growing frequency and complexity of licensure defense proceedings. As regulatory scrutiny intensifies and patient expectations shift, practitioners find themselves navigating a terrain where minor oversights can rapidly escalate into formal legal challenges or administrative proceedings threatening their right to practice.
Mitigating these exposures requires a proactive, highly informed approach to clinical practice and risk mitigation. Crystal Miller, RPLU, CPCU, underwriting director at CNA, underscored the value of utilizing data-driven insights to curb litigation risks and foster a culture of safety.
"By understanding the factors that lead to claims, physical therapy professionals and practices can take proactive steps to help reduce risk and lower the chance of litigation," said Miller. "This report aims to raise awareness of trends and claim drivers to enhance risk management knowledge and support safer care for physical therapy professionals and their patients."
To extend the reach and practical application of the report’s findings, HPSO has announced plans to roll out a targeted series of seven Physical Therapist Spotlights in the coming months. These spotlights will feature direct links to educational resources that highlight risk control best practices across several vital operational pillars, including proper clinical documentation, strategies for effective licensure defense, and the safe integration of emerging technologies into everyday practice.
The data underpinning the Physical Therapy Professional Liability Claim Report: 5th Edition represents a collaborative, ongoing educational commitment by CNA and HPSO to support the physical therapy community. The underlying general analysis incorporates 497 closed professional liability claims. This dataset encompasses claims involving physical therapists, physical therapist assistants, physical therapy practices, and various other healthcare practitioners who provided services as employees of an insured physical therapy practice between January 1, 2020, and December 31, 2025. To ensure the relevance of the findings to serious legal and financial exposures, the analyzed claims are restricted to those that resulted in an indemnity payment of $10,000 or greater, establishing the foundation for what is referred to as the 2026 dataset.
Healthcare professionals, practice administrators, and legal compliance officers seeking an in-depth understanding of these trends can access the complete findings, analytical breakdowns, and risk mitigation strategies. The full Physical Therapy Professional Liability Claim Report: 5th Edition is currently available for download through the HPSO resource portal at https://www.hpso.com/ptclaimreport.
