Perspectives from the ASGBI Medicolegal Lead
Medical malpractice indemnity is a specific form of professional indemnity insurance tailored to the needs of healthcare professionals and is the cornerstone of your professional security as a practising General Surgeon, whether you undertake Private Practice or not. Below are listed some key considerations that need to be taken into account when considering your needs.
The information contained in this article is for general advice only. It does not constitute formal legal advice and it is up to the individual to obtain medical malpractice insurance that is appropriate to his or her specific needs.
1 - State Backed Indemnity
For NHS or public work, the state provides occurrence-based cover, meaning claims are honoured regardless of when they arise. Indemnity is provided through specific schemes that vary slightly depending on which nation you work in. The Clinical Negligence Scheme for Trusts (CNST), administered by NHS Resolution, provides indemnity for NHS surgeons working in England. Wales, Scotland and Northern Ireland have their own schemes that function in a similar fashion.
In Ireland, the state-backed indemnity scheme is called the Clinical Indemnity Scheme (CIS). It is operated by the State Claims Agency (SCA). Like its UK devolved nations counterparts the CIS provides state indemnity for clinical negligence claims arising from the diagnosis, treatment, and care of patients in Ireland’s public healthcare settings.
PROS:
Comprehensive for clinical negligence within NHS or public duties only
No personal premium for NHS/public - employed work
CONS:
Excludes private practice, medico-legal work, and Good Samaritan acts
No support for GMC investigations, disciplinary hearings or inquests
2 - Discretionary Indemnity (Medical Defence Organisations)
MDOs such as the MDU, MDDUS and MPS offer wide-ranging support, including advice and representation. Cover is however, discretionary, not contractual. In practice MDOs almost always provide assistance if you have acted in good faith and in line with professional standards. MDOs have strong reputations for supporting members. However, because cover is discretionary, you cannot enforce assistance in court like you could with an insurance contract. Many doctors value this flexibility because MDOs often go beyond what insurance would cover.
PROS:
Access to medicolegal advice, risk management resources, professional support
Although discretionary on the part of the MDO, it often includes representation at GMC hearings and inquests
CONS:
No legal obligation to pay claims; decisions rest on provider discretion
Unregulated by the FCA, limiting financial security and recourse
3 - Contractual Indemnity (Insurance-Based Policies)
Commercial Medical Indemnity Providers offer contractual, FCA-regulated cover, often tailored for surgeons.
PROS:
Legally binding obligation to meet claims.
High aggregate limits (up to £20m per claim in some schemes)
Includes run-off cover for retirement, death, or disablement
CONS:
Policies are usually “claims-made,” requiring you to maintain continuous cover or to ensure that run-off arrangements are in place when you retire
4 - Policy Structure: Occurence vs Claims Made
Occurence-Based: covers incidents that occur during the policy period, even if claims come to light years later. The MDOs such as MDU, MPS and MDDUS typically operate on this basis.
Claims-Made: covers claims reported while the policy is active as long as the incident occurred after the retroactive date (earliest date from which an insurance policy will provide coverage for claims) ; requires run-off cover when you cease cover such as in the situation of post-retirement.
Key Points to Consider when Assessing your own Indemnity Requirements
Consider your practice profile
Do you practice in the state system only or do you do private practice or medicolegal work? How do you see your practice profile change in the future? Different indemnity models suit different practice profiles. Most would opine that state backed indemnity does not provide sufficient cover to meet the needs of the practicing surgeon in the modern NHS, even if the surgeon works exclusively for the public system and does not undertake private practice.
Although we never want to imagine that we might ever be in the situation to require it, having the back-up of being able to call upon formal legal representation at inquests and regulatory hearings in particular, can be invaluable. Dealings with the GMC (or IMC in Ireland) or with an employer’s internal disciplinary process is unfortunately becoming an increasingly common occurrence in the life of a practising surgeon. Having additional personal professional indemnity insurance to supplement state based cover is considered essential.
Make sure gaps in cover are avoided
It is relatively straight-forward to move from an Occurrence-Based scheme to one that is Claims-Made as long as you consider, and plan for, the provision of run-off (otherwise known as extended reporting) cover for after you retire. Most insurance companies who offer claims-based medical indemnity schemes will provide extended reporting cover after you retire free of charge as long as you have stayed with the company for a set length of time.
It requires much more thought and planning to move from a Claims-Made scheme to an Occurrence Based product. ‘Tail’ cover (provided from the company you leave, or ‘Nose’ cover (provided by the company you are moving to) is essential to ensure that there is no Coverage Gap. Remember the old claims-made policy will not cover claims made after its expiration date, unless it was reported during the policy period. The new Occurrence -Based model will only cover incidents that occur during its active period and won’t cover claims when the incident occurred prior to the commencement of the policy, even if it is reported in the period of the policy.
Don’t underestimate extras and be prepared to shop around!
GMC and local Trust internal disciplinary process representation, inquest support, and wellbeing services can be invaluable if included in the medical malpractice indemnity.
Also don’t forget to review your medical indemnity insurance policies and premiums when up for renewal and do consider the costs of these services in relation to what cover they provide. It is OK to shop around and switch providers if services are superior and premiums are less than your previous policy as long as you consider hidden costs such as the provision of nose or tail cover to ensure that you don’t have a coverage gap and that run-off cover is assured for after you retire.
Mr Gary Spence
ASGBI Medicolegal Lead
