PROFESSIONAL INDEMNITY POLICY FOR MEDICAL PROFESSIONALS & PROVIDERS IN INDIA
What is Professional Indemnity policy?
The word indemnity means security or protection against a financial liability. This policy is meant for professionals to cover any financial liability falling on them as a result of errors and omissions committed by them whilst rendering professional service to any clients/patients etc. depending on the indemnity cover/limit taken by the professional. Inclusions/exclusions & terms of the policy issued by insurance co.
WHY Indemnity policy for Doctors & medical centres?
➢ The numbers of legal cases accusing doctors/medical centres of negligence have gone up by 400% in the Supreme Court
➢ With very high claims cases being filed by patients/families against medical professionals, its critical for medical professionals now to have a new age indemnity policy that protects the financially in case the Courts/Consumer forums verdict goes against them
➢ Insurance companies provide one year indemnity policy
➢ It allows professionals to carry out their work with greater confidence and peace of mind as it not just protect the doctors but also the non medical staff, radioactive coverage, international patients, online consultations, 2nd opinion & many more inclusions
Who can take Indemnity policy?
The policy is meant for the following group of professionals: ‐
i. Doctors and medical practitioners ‐ which covers registered medical practitioners like physicians, surgeons, cardiologists, pathologists etc.
ii. Medical establishments ‐ which cover any financial liability falling on the medical establishment such as hospitals and nursing homes, as a result of error or omission committed by any visiting/employed Doctors or qualified assistants engaged by the medical centre.
What all can be covered under indemnity policy?
The professional indemnity insurance provides cover for the following depending on the features of the policy taken:
● Retroactive date coverage helps Doctors & medical centre cover their previous period claims coverage also
● The extent of financial damage for loss caused to victim which is not a result of wilful neglect
● Against unintentional errors and omissions by the doctor, insured qualified employees, insured non-qualified staff, owners, Directors, CFO, CEO etc., if included under the policy
● The policy will not cover criminal acts, fraudulence, penalties or punitive damages
● Out of court settlement, subject to the terms and conditions of the Policy
Exclusions of standard Indemnity Policy?
Exclusions contained in the Policy limit the scope by excluding something that would otherwise be covered. The insurance policy will not cover the following:
● criminal acts, fraudulent, dishonest or malicious acts ● non‐compliance of any statutory provision ● loss of goodwill ● conditions associated with HIV/AIDS ● Acts committed under Influence of intoxicants / narcotics ● Blood banks ● Cosmetic surgery
Basis for indemnity cover amount?
The sum insured should be chosen in a manner that it covers any financial liability & legal cost for handling of any medical negligence case in Courts etc.
➢ Specialization of the doctor (Cosmetics, Anesthetics, Surgeons & Gynecologists at highest risk, followed by super specialists, Dentists, radiologists, physicians & GP’s)
➢ Practicing at hospitals, followed by practicing at medical centres & own clinics
➢ Practicing at Hospitals, followed by practicing at medical centres & clinics
➢ Fee being charged to patients
➢ Probability of claim being filed depends on specialization & procedures being done & risk exposure depending if Doctor is practicing in metro, 2 tier or 3 tier city also.
➢ Adequacy of sum insured and the coverage with additional benefits opted
In Professional Indemnity Policy, the sum insured is referred to as Limit of Indemnity. This limit is fixed per accident and per policy period. It is called Any One Accident (AOA) limit and Any One Year (AOY) limit respectively.
The retroactive date in a professional indemnity insurance is the date from which uninterrupted professional indemnity insurance has been held, or a date in the past from which the insurer has agreed to cover the doctor. Anything that happened before the retroactive date isn’t covered by the insurance.
Retroactive date coverage is critical if any patient files a claim that is before your current indemnity policy start date. Since, Courts accept medical negligence claims upto 4-5 years old. its important that your your current policy has correct retroactive date as per actual continuity of your current indemnity policy
How to handle claim with Insurance Co.?
In case of any event likely to give rise to a liability claim:
1. The event should have occurred during the period of insurance or retroactive period
2. Insurance Company should be informed immediately
3. In case any legal notice or summons is received, it should be sent to the insurance company
4. Ensure that only true information pertaining to the case is disclosed
5. The Any One Year limit will get reduced by the amount of claim or indemnity paid for any one accident.
6. Delay in notification could mean that cover for that particular claim is not provided
KEY POINTS TO REMEMBER WHILE TAKING PROFESSIONAL INDEMNITY
The doctors know very little about the detail of their professional indemnity arrangements, and in particular the policy terms and conditions. It is therefore important to keep in mind the following key points while taking the policy:
● A doctor while signing up for the policy has a duty to disclose all material information correctly
● Familiarise with the policy details and clarify the exact meaning of any clauses
● Specialization and the sum insured as per the risk factors
● Retroactive date
● Renewal of the Policy without any break
● Understand all Inclusions and exclusions of the Policy
● Ratio of AOA:AOY should be 1:1
● Claim procedure
● Whether indemnity insurance for non-medical staff is covered
● Coverage of International patients/NRI’s
● Whether cosmetic surgeons and surgeries covered like hair transplant, dentist etc.
● Ensure that the sum assured is not very small as there can often be a long delay between an event and a subsequent claim, one needs to be covered both at the time of the event and when the claim is made.