Malpractice insurance usually has a cap, so that wouldn't protect you fully (and I would be weary of exclusions and exceptions). But again, I'm not an attorney, so this would be a great question to ask. LLC protects your personal assets from the liabilities of the LLC. So your house, your brokerage account and your liquid assets. Without the LLC, your entire estate (except for the 401k plan assets) can be subject to creditors or litigation. That's the primary purpose of the LLC, because as far as taxes, LLC is the same as solo proprietor (unless you elect to be taxed as an S-corp). Of course, I would consult with an attorney about whether the LLC will protect a doctor (it might not). S-corp might make sense if you own a business (or have a very profitable practice on the side), but the requirements are much more onerous and the cost of filing taxes can be higher than for an LLC.