The financial and operational risks facing physical therapy professionals have escalated significantly over recent years, according to comprehensive new industry data. A newly released report highlights a sharp upward trajectory in professional liability claim costs, pointing to growing vulnerabilities associated with hands-on treatments, patient monitoring, physical injuries, practice-level claims, and complex licensure defense matters across the rehabilitation sector.
The findings are detailed in the Physical Therapy Professional Liability Claim Report: 5th Edition, a joint publication by Healthcare Providers Service Organization (HPSO)—part of the Healthcare division of Aon Affinity, the affinity business of Aon plc—and CNA. According to the updated dataset, the average total incurred cost for professional liability claims involving physical therapy professionals has surged by 20.3% to reach $162,174.
Furthermore, the data illustrates a concerning shift toward higher-severity payouts. The share of claims closing in the substantial indemnity range between $250,000 and $749,999 has risen notably from 9.3% to 13.7% since the publication of the previous dataset in 2020. This upward movement in claim severity underscores the mounting financial stakes for physical therapists, physical therapist assistants, and practice owners operating in an increasingly litigious and complex healthcare environment.
Industry leaders emphasize that the modern practice of physical therapy requires navigating a delicate balance between maximizing patient recovery and mitigating emerging liability exposures. Jennifer Flynn, vice president of risk management for Healthcare Providers Service Organization, noted that while practitioners remain deeply dedicated to providing safe and effective care that restores patient mobility and function, the broader professional landscape has grown increasingly complicated.
"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," Flynn said. She explained that the newly published report was specifically developed to equip physical therapists, physical therapist assistants, and independent practice owners with actionable insights and risk management strategies designed to minimize their unique professional exposures.
The comprehensive analysis draws from a robust sample of closed professional liability claims. Specifically, the general evaluation encompasses 497 closed claims involving physical therapists, physical therapist assistants, physical therapy practices, and other healthcare practitioners who provided services as employees of insured physical therapy practices between January 1, 2020, and December 31, 2025. To qualify for inclusion in this 2026 dataset, each claim had to have resulted in an indemnity payment of $10,000 or greater, ensuring that the findings reflect material legal and financial events within the profession.
As the rehabilitation sector continues to evolve alongside shifting patient demographics and technological advancements, underwriters and risk management experts stress the importance of proactive legal and operational awareness. By examining the underlying drivers of litigation and regulatory scrutiny, practices can better protect both their financial viability and the safety of their patients.
Crystal Miller, RPLU, CPCU, underwriting director at CNA, emphasized that education and early risk mitigation remain the most effective tools for combating rising litigation trends.
"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," Miller said. She added that the primary objective of the report is to elevate industry awareness regarding prevailing claim trends and core risk drivers, ultimately enhancing risk management knowledge and supporting safer, higher-quality care standards for physical therapy professionals and the patients they serve.
In tandem with the release of the comprehensive 5th Edition report, HPSO has announced plans to roll out an extended educational initiative over the coming months. The organization will publish a series of seven distinct Physical Therapist Spotlights. These forthcoming resources will feature direct links to supplemental educational materials and risk control best practices addressing vital operational topics, including proper clinical documentation standards, strategies for effective licensure defense, and the safe integration of emerging technologies into daily clinical workflows.
The complete Physical Therapy Professional Liability Claim Report: 5th Edition—including detailed case studies, expert commentary, comprehensive data analysis, and targeted risk management recommendations—has been made publicly available. Physical therapy professionals, practice administrators, legal counsel, and academic institutions seeking to review the full dataset and its associated limitations and analytical considerations can access and download the publication directly through the HPSO resource portal at https://www.hpso.com/ptclaimreport.
