Inform insurer

17 November, 2016

 I am a cardiac surgeon looking to buy professional indemnity insurance. Can you tell me a little bit more about it?

—Pradeep Sharma

Professional indemnity insurance will cover you against litigation by your patients. The scope of the cover is the loss suffered by your patients due to alleged professional negligence. These include patients suing for negligent diagnosis or administration of sub-standard course of treatment. The policy pays for lawyer’s fees to defend yourself and compensation, if awarded by the court. 

The insurance does not cover wilful acts. While buying a policy, be mindful of three aspects: select an appropriate level of sum assured, ensure that the full policy sum assured can be utilised in any one accident, and evaluate add-on covers. The extent of medical malpractice suits has increased rapidly. There have been a few instances where claims of several crores have been awarded. While adjudging compensation, courts look at the loss of potential income of the patient right up to their retirement.

You should choose a sum assured based on your client profile and your specialty. Surgeons and anaesthetists are most prone, and need the highest sums assured. In professional indemnity insurance for doctors, some insurers have a practice of limiting the sum assured available for a particular accident to a fraction of the overall sum assured. This is done via the clause of Any One Accident:Any One Year (AOA:AOY). Insist on an AOA:AOY of 1:1. 

You should consider add-on covers to the core professional indemnity insurance. These add-ons help override some of the exclusions of a standard policy and broaden the coverage. Examples of add-ons are: loss of documents, breach of confidentiality, dishonesty of employees, libel and slander.