Choosing the right medical indemnity insurance is a key decision every practitioner makes during their career. Due to the high stakes nature of the medical profession, having adequate insurance is crucial – especially when you’re starting your own medical practice. With greater responsibilities comes heightened risk, so it’s essential that you have the right level of cover to safeguard yourself, your employees and your practice.
Here, we delve in the eight important considerations to take into account when selecting the right medical indemnity insurance for doctors.
What is medical indemnity and why is it important that you get it right?
Medical indemnity insurance works to protect practitioners and the patients they treat or come into contact with. It outlines the amount insured and covers legal costs and compensation resulting from the healthcare services medical professionals deliver. It can also include cover for:
- Statutory fines and penalties.
- Disciplinary, criminal or coronial proceedings, plus inquiries resulting from the healthcare doctors provide.
- Medical information practitioners have provided that is published in certain formats.
- Healthcare provided outside of Australia.
- And unpaid healthcare.
While many people think of indemnity as medical malpractice insurance, there’s more to it than just protecting yourself against ‘getting sued’. Selecting the right medical indemnity insurance helps to ensure your patients, your reputation and your career are safeguarded in the rare scenario that something goes wrong.The type of cover you choose as a medical practitioner depends largely on your individual situation, which is why it’s so important to ask these eight questions before you settle on a policy or change your existing one.
Questions to consider when choosing or changing your medical indemnity
1. Is your employer indemnified?
If you are employed by a medical organisation it’s important to find out if you are covered by its indemnity. If you are, you may be able to pay a lower membership fee to only cover extras that aren’t included — for example, away from work costs and Good Samaritan cover.
If you’re not employer indemnified (as can be the case for locums, for example), it’s crucial to speak to management about getting covered or organising your own. If you are seeking employment, ask what level of indemnity will be provided before you accept the job. Visiting Medical Officers (VMOs) who are not employed by a hospital but use the facilities for their practice, should be clear about how this relationship impacts the level of cover that they need.
2. What to do as a practice employer
In Australia, all medical practitioners must be indemnified. You can offer this as an employer or the doctors you employ can provide it themselves through their insurer. Talk openly with your staff – including locums and consultants – about the level of cover your medical indemnity insurance offers . If you have allied health professionals working in your practice, they also require indemnity.
Some insurance providers offer practice indemnity policies to cover your entire clinic, including nurses and non-medical staff such as practice managers. This can provide cover for claims made against the practice entity and the actions of your employees. It can include reputation of the practice, complaints, inquiries and investigations, employment challenges, patient injury and more.
3. What does claims-made insurance cover?
Indemnity insurance in Australia is provided on a claims-made basis.
- Claims-made means that you’re covered for any incident, regardless of when it happened, if you make a claim during that period cover. The policy cover is triggered when a claim is made against you and is accepted by the insurer – not from the date of the incident.
With claims made insurance you’re not covered if a claim is lodged against you after the indemnity period has finished. It’s crucial to know the implications before you select your medical indemnity.
4. How retroactive cover works and why you need it
Retroactive cover – or ‘tail’ cover as it’s commonly referred to – is included in claims-made medical indemnity policies. Doctors are required by the Medical Board of Australia to take out appropriate retroactive cover as part of their indemnity insurance. It refers to a date in the past that they nominate their cover starts from (in many cases, the date a doctor started practicing).
The cost of this cover generally depends not only on how far in the past the retroactive date is, but also the type of practice undertaken during that time and the location. Taking out unlimited retroactive cover ensures you won’t have a gap in cover for unknown reasons, which could arise during a period when you’re changing indemnity insurance providers, for example.
5. Will you be providing medical expertise outside of your work or through telehealth services?
Whether it’s assisting in an emergency, volunteering for a not-for-profit or even just helping a stranger on the street, there are times when medical professionals may be called on for duty outside of the workplace.
In fact, there is a legal obligation and precedent for all Australian doctors to offer “assistance in an emergency that takes account of your own safety, your skills, the availability of other options and the impact on any other patients under the practitioner's care”. Not doing so, could open practitioners up to complaints. It’s important to consider personal medical indemnity so you are covered in these scenarios.
For practitioners who provide non-face-to-face contact with patients through telehealth services it’s also crucial to consider the potential risks involved. Challenges include maintaining patient confidentiality and privacy, the limitations of non-face-to-face consultations, and possible cross-border issues where telehealth services are provided to people in other states or other countries..
Practitioners who adhere to the AHPRA’s social media policy can still suffer loss of reputation as a result of negative comments and reviews on social media, and in other forms of media.Your professional indemnity should take these factors and others into consideration.
6. Is cyber insurance included?
There are various scenarios where medical data may be compromised. The consequences of data breaches and losses can be far reaching and can include loss of reputation and loss of profit. As the 2017 NHS ransom incident revealed, it can even have life and death implications.
Furthermore, the Notifiable Data Breaches scheme recently came into effect, meaning Australian businesses with annual turnover exceeding $3 million are legally obliged to promptly inform seriously affected individuals and the appropriate government office in the case of a privacy breach. For this reason, it’s important to determine whether your medical indemnity covers cyber insurance or if you should take out more or separate cover.
“There are many elements involved and it’s not clear-cut from an insurance perspective,” says Eric Lowenstein, CEO of Tego Insurance. “I would typically advise a medical practitioner to consult a general insurance advisor. Find someone that is able to independently review their cover and understand what the gaps are, understand what their needs are,” he says.
Questions to ask an advisor include, ‘Does the cover provide a trusted touchpoint with the technical expertise to minimise and repair a breach?’ And ‘Is there financial cover for the managing legal obligations following a breach?’
7. What is their process for handling your claim?
Before settling on an insurance provider, it’s imperative to identify how claims will be handled. What is the process for submitting claims? What level of support and guidance is provided? How long are waiting periods? Asking these questions upfront when choosing a new indemnity provider can help prevent miscommunications and mishaps down the track.
8. What are the limits and sub-limits?
Most policies in Australia provide $20 million of cover, however there may be different sub-limits in place. In this scenario, a practitioner could be out of pocket, even though the total limit hasn’t been reached. It’s important to invest ample research into the specific limitations of each option.
Over to you
By selecting the right indemnity instance, you can not only protect yourself, patients and medical practice, but also make the process as smooth and stress-free as possible if the need to submit a claim arises.
Today’s medical practitioners have a wealth of options available, so making strategic financial choices can become challenging. To take the confusion out of the equation and streamline your day, we’ve created this handy A-Z guide for building smart medical practice finances.