Running a dental practice in California means navigating a complex web of insurance requirements. Some are absolutely mandatory—you'll face serious penalties if you skip them. Others are technically optional but so essential that going without them puts your entire business at risk. Here's what you need to know to protect your practice, your team, and your financial future.
Workers' Compensation: The Non-Negotiable Requirement
Here's the clearest rule in California dental practice insurance: if you have even one employee, you must carry workers' compensation coverage. It doesn't matter if that employee is full-time, part-time, or just started yesterday. California Labor Code Section 3700 is crystal clear—there are no exemptions based on practice size.
For dental practices, workers' comp typically costs around $65 per month, or about $785 annually. That's a small price compared to what you'd face without it. If an employee gets hurt and you don't have coverage, you're personally liable for all their medical costs, rehabilitation, wage replacement, and you'll face additional state penalties on top of that.
What does it cover? Your policy handles five types of benefits: medical care for work-related injuries, temporary disability payments while an employee recovers, permanent disability benefits if they can't fully return to work, supplemental job displacement benefits for retraining, and death benefits for dependents in worst-case scenarios. Common dental office injuries include repetitive strain from scaling and polishing, needlestick injuries, exposure to bloodborne pathogens, and good old-fashioned slips and falls in clinical areas.
Professional Liability Insurance: When It's Required and When It's Not
This is where things get nuanced. California doesn't require most dentists to carry professional liability (malpractice) insurance. If you're running a solo practice and don't accept Medi-Cal, you could technically practice without it. But here's the thing: almost no dentist actually does this, and for good reason.
Professional liability insurance protects you when a patient claims you made a mistake in their treatment—whether that's a botched root canal, an allergic reaction to materials you used, or a complication from oral surgery. Without coverage, you're paying for your legal defense and any settlement or judgment out of pocket. A single lawsuit can easily reach six or seven figures.
There are important exceptions where coverage becomes mandatory. If you accept Medi-Cal patients, you must maintain at least $100,000 per claim with a $300,000 annual aggregate. If you've incorporated your practice as a dental corporation, California law requires minimum coverage of $50,000 multiplied by the number of employed licensed persons for each claim, with aggregate limits scaling similarly. For a corporation with three dentists, that's $150,000 per claim and $450,000 aggregate minimum.
Industry standard coverage is much higher than these minimums: $1 million per occurrence and $3 million aggregate. Most dental professionals carry this level regardless of whether they're legally required to, and many commercial leases or hospital privileges require you to maintain it as a condition of your contract.
General Liability: Protecting Against Non-Medical Risks
General liability insurance covers the stuff that happens outside the dentist's chair. A patient trips over an uneven threshold in your waiting room. Your hygienist accidentally knocks a patient's laptop off the counter while cleaning an exam room. A delivery person slips on your freshly mopped floors. None of these are malpractice issues, but they can all result in expensive lawsuits.
California doesn't legally require general liability insurance, but many commercial landlords do. Your lease probably has a clause requiring you to maintain a minimum level of coverage—often $1 million per occurrence. Even if your lease doesn't require it, this coverage is cheap enough that skipping it doesn't make financial sense. It's typically bundled with property insurance in a Business Owner's Policy (BOP), which gives you both general liability and protection for your physical assets like dental equipment, office furniture, and inventory.
2025-2026 Compliance Updates for California Dental Practices
California dental regulations don't stand still. Several changes took effect in 2025 that impact your insurance and compliance picture. As of January 1, 2025, unlicensed dental assistants must complete an 8-hour Board-approved infection control course before they're exposed to blood, saliva, or other potentially infectious materials. This applies regardless of when they were hired—even long-term employees need to complete the training if they haven't already.
Starting in 2026, the Workplace Know Your Rights Act (SB 294) requires you to provide annual written notice to all employees about their rights, including workers' compensation benefits. The first notice must go out by February 1, 2026, and annually after that. It's a compliance requirement, not an insurance requirement, but it's closely tied to your workers' comp obligations.
Also worth noting: California's healthcare minimum wage continues to climb. It hit $23 per hour through June 2025, increases to $24 for the remainder of 2025, and rises to $25 in July 2026. Higher wages mean higher workers' compensation premiums, since your premium is calculated as a percentage of payroll. Budget accordingly.
Getting Your Coverage in Place
Most California dental practices end up with three core policies: workers' compensation (legally required), professional liability (required for Medi-Cal providers and dental corporations, strongly recommended for everyone else), and a Business Owner's Policy that bundles general liability with property coverage. If you have company vehicles, you'll also need commercial auto insurance.
Work with an insurance broker who specializes in dental practices—they understand the specific risks you face and can help you avoid coverage gaps. Make sure your professional liability policy covers both you and any associate dentists or hygienists working under your supervision. Review your policies annually, especially if you add staff, expand your services, or move to a new location. Your insurance needs change as your practice grows.
The good news? Once you have the right coverage in place, you can focus on what you do best—providing excellent dental care. Insurance is one of those business expenses that feels invisible until the moment you desperately need it. Get it right from the start, and you'll never have to find out what happens when you get it wrong.
