Medical Indemnity Insurance Explained

Despite being a regulatory requirement for doctors, allied healthcare professionals and clinicians within the UK, the topic of Medical Indemnity Insurance can seem daunting. For a lot of healthcare professionals working within a primary care setting, their Medical Indemnity Insurance is already covered by a state-backed scheme.

However, not all healthcare services are covered within this scheme. Now is a critical time to know when you may need to seek additional or alternate covers, as pressure increases for clinicians and healthcare professionals.

In this article, we will help to explain Medical Indemnity Insurance and determine when you should be exploring alternate options to the state-backed indemnity scheme.

Defining Professional Indemnity, Medical Indemnity (Medical Malpractice) Insurance

Professional indemnity insurance is a broad form of liability cover for professionals across many industries who provide professional advice or services which could inadvertently lead to poor advice, misrepresentation, breach of duty and, ultimately financial loss.

Medical malpractice occurs when a hospital, doctor or other health care professional, through a negligent act or omission, causes an injury to a patient. The negligence might be the result of errors in diagnosis, treatment, aftercare or health management.

A Medical Indemnity Insurance, which is also commonly referred to as Medical Malpractice Insurance, can offer protection to cover legal costs of defending actions against them or pay out compensation awards in respect of any claims/cases which need to be settled.

Professionals who require Insurance

To practise within the UK, it is a regulatory requirement set by the General Medical Council (GMC) for doctors / clinicians to make appropriate arrangements to have adequate insurance in place.

However, any member of staff working in general practice, ranging from the general practitioners themselves, pharmacists, nurses, allied healthcare professionals and even non-clinical staff such as receptionists, should review their insurance arrangements.

If your sole duties working within general practice are for the NHS, you will be automatically enrolled onto the Clinical Negligence Scheme for General Practice, or CNSGP for short (1). This scheme offers Medical Indemnity cover for NHS workers, but only for incidents occurring on or after 1^st April 2019 and will only cover claims detailed within its scheme.

Because of this, professionals who require Medical Indemnity Insurance may look to alternate providers outside of the state-backed CNSGP to either top-up or find more appropriate cover. Often this means using a specialist insurance broker to source a commercial insurance policy, such as Medical Malpractice Insurance with MIAB, or relying on a Medical Defence Organisation subscription.

The Increasing Need for Protection

Outside of contractual and Professional Body or Association requirements, there are increasing societal pressures on doctors and clinicians which warrants the need for protection.

Following trends seen in the United States, litigious activity is rising significantly in the UK, meaning more patients are claiming negligence for their treatment of care. Moreover, settlement costs are following a similar trend in government forecasts (1).

There has been a higher demand in private services and an increase in complex work. Private services, such as weight loss medication or ADHD diagnosis, are at an all-time high to cater for NHS waiting lists. However, can lead to complex claims, especially when working with new healthcare resources or innovations.

Examples Negligence, Errors and Omissions

In many cases, claims arising from negligence, errors and omissions that are specific to a particular incident. Claims can be made against individual practitioners or even organisations.

When reviewing a Medical Malpractice Insurance policy, your policy documents will identify how it is intended to support you in the event of a claim. Typical examples of negligence, errors and omissions can look like:

Bodily injury harm due to treatment of care
Diagnostic errors
Informed consent failure
System or organisational errors

Due to the complexities of healthcare claims and costly legal proceedings, a single claim can be financially devastating for organisations and individuals alike.

Types of Cover

When arranging your Medical Indemnity Insurance or Medical Malpractice policy, there are two key types which are determined by how a claim is covered in the event of an incident or event.

Traditional cover, typically offered by Medical Defence Organisations, is arranged as an Occurrence-Made scheme. It will cover incidents arising during the policy period, even if the claim is made later, after the policy has ended.

An Insurance Contract will operate as a Claims-Made scheme. It will cover incidents that occur and are reported during the policy and membership period. After the policy or membership has ended, it is often required that these clinicians find “run-off” cover, even if they aren’t practising, to stay protected against any future claims.

Benefits to an Insurance Contract

Using a Specialist Insurance Broker is a popular option amongst clinicians looking for their Medical Indemnity Insurance due to its flexible benefits and clarification in policy details.

Medical Indemnity cover that is provided by MDO’s are subscription based, are underwritten on a claims-occurrence basis and paid out under their discretion. Whilst they are able to offer you medico-legal advice, there is no contract in place to protect you in the event of a claim due to their discretion when settling any claims.

On the other hand, using a specialist insurance broker offers contract certainty giving clear definition of what is and isn’t covered in the event of a claim. Insurance providers are bound by the FCA regulation and their code of conduct which means that they must have adequate funds to meet all liabilities. MIAB offers Medical Malpractice policies on a claims-made basis, so you have immediate understanding of what indemnity cover you have in place.

Further benefits to using a Specialist Broker, such as MIAB, can be summarised below:

Dealing with a dedicated team who specialise in your sector only
An adviser will have access to wide range of insurers on the open market. This provides healthy competition and advantageous pricing for the client
Ability to craft a policy bespoke to your scope of work, including private services such as vaccinations, prescribing or coroners inquests.
Ability to add extensions of cover to your policy for GMC investigations, exercising the Good Samaritans Act (2) or managerial responsibilities.
24-hour medico-legal support and 24/7 consumer legal advice.
Tailored “run-off” cover for when you no longer need your claims-made policy.

By choosing a specialist broker you may find better suited protection, particularly for those operating services outside of the NHS or would like contract-certain indemnity protection.

What do I do if I have been refused cover?

In some cases, clinicians can be refused Medical Indemnity cover by MDO’s, or it can rise dramatically at a point during their career. Whilst this could be because of a previous claim or disciplinary, it can also happen due to issues relating to subscription as noted in the internal rules, articles of association, and memorandum of the specific mutual, so it is important to be aware of alternate indemnity providers.

MIAB’s specialist insurance providers have a wealth of experience in providing those who have been refused cover with appropriate policies so that they can continue practising. Not only can they help find favourable terms depending on your circumstances, but they can also offer guidance throughout your rehabilitation process so that it goes as smoothly as possible. All starting with a no-obligation discussion either on MS Teams or on the phone, whichever is best for you.

How else is MIAB able to support?

Our Medical Indemnity Insurance advisers are specialists in this field and are available for free consultations during our regular working hours. They can discuss a variety of enquiries regarding your Medical Indemnity Insurance, whether you are looking to change your provider, add an extension to your current policy or ready for your run-off cover.

You can book your consultation on the phone using 01438 547044 or submit an enquiry to indemnity@miab.co.uk.