Medical indemnity insurers provide specialised professional indemnity insurance for doctors in Australia. They may also provide additional support services, such as a 24/7 direct line to highly experienced medical lawyers for doctors needing advice regarding their legal obligations and potential liabilities in any given situation.
All medical indemnity insurers in Australia must meet the minimum product standards prescribed in the Commonwealth Medical Indemnity (Prudential Supervision and Product Standards) Act 2003. There are five national medical indemnity insurers for doctors, all listed on the Department of Health website:
- Berkshire Hathaway Specialty Insurance (distributed by Tego Insurance)
- MDA National
- Medical Insurance Group Australia (MIGA)
- Medical Indemnity Protection Society (MIPS)
Why do I need medical indemnity insurance?
Under the Australian National Law, all practising medical practitioners must be insured or otherwise indemnified for their entire scope of practice, whether via their employer’s indemnity arrangements or through their own medical indemnity insurer. This means it is mandatory for all doctors in private practice to have their own personal medical indemnity insurance. It is also a requirement for registration with AHPRA.
If your insurance or indemnity arrangements specifically exclude any aspect of practice you must not practise in that area. If you discover you do not have appropriate professional indemnity insurance arrangements in place, you are obliged to notify the Medical Board of this within 7 days.
Professional indemnity insurance generally will not cover your practice entity or employees, and a separate policy will be required for this.
How do I choose which insurer?
Not all policies are the same, and not all premiums are the same. Further, just because you have been with one insurer for a long time does not mean they are necessarily the best insurer for you. You are not obliged to stay with the same insurer, even if they have previously assisted you, and you are entitled to evaluate your options and consider other insurers at any time.
All medical indemnity insurance policies cover personal liabilities that might arise out of your provision of healthcare (including legal costs) by way of civil claims (that is, claims in medical negligence), and to a more variable extent, non-civil claims (such as coronial inquests, professional or disciplinary investigations, employment disputes – namely, anything other than requests for compensation).
All policies in Australia typically provide $20 million cover, however different policies apply different sub-limits to non-civil claims – meaning that specific cover will vary between policies. Some policies, not all, also include cover for exposures such as costs towards protecting your reputation (eg. in the event of adverse social media) and pursuing or defending defamation claims, Medicare audits, tax audits, employment disputes, as well as cover for statutory penalties (such as privacy breaches) and loss of income if you are required to attend court.
Be aware that some policies impose excesses/deductibles in certain circumstances which must be paid if assistance is required under your policy. Some medical indemnity insurers cover the treatment of public hospital patients if you are not otherwise indemnified. If you provide any medical services overseas, even in the form or teaching or lecturing, you should check with your insurer if you are covered.
Medical indemnity insurance in Australia is provided on a ‘claims made’ basis, which means you are required to notify your insurer as soon as you become aware of a claim (or of circumstances which a reasonable person would expect may result in a claim). Any claims made under one policy will continue to be covered by that policy even if you switch insurers.
It is also a requirement that your insurance includes adequate retroactive cover for all prior practice in Australia, so it is important you check the retroactive date under your policy (also known as “tail cover”).
Premiums are generally assessed by the doctor’s state of practice, specialisation, claims history and billings band. Not all medical indemnity insurers adopt the same pricing approach and some will specifically assess your premium in accordance with your individual risk profile including actual gross private billings and sub-specialty areas. Some insurers require you to report any increase in income during a policy period (particularly those that adopt a billing band method) and reserve the right to seek additional premium retrospectively.
Some insurers offer significant discounts to reward compliance with certain accreditation standards or to assist doctors who are new to private practice. Given the differences in premiums and policies, you may wish to engage an insurance broker who can offer independent advice as to which product is best for you. If you find an insurer that better suits your needs it is possible to switch and your broker can advise you on this also. Your choice of medical indemnity insurer may potentially impact your livelihood, reputation, and savings, so it is in your best interests to investigate your options and find the best policy that suits your individual needs.
This publication is general in nature and is not comprehensive or constitute legal or medical advice. You should seek legal, medical or other professional advice before relying on any content, and practice proper clinical decision making with regard to individual circumstances. Persons implementing any recommendations contained in this publication must exercise their own independent skill or judgment or seek appropriate professional advice relevant to their own particular practice. Compliance with any recommendations will not in any way guarantee discharge of the duty of care owed to patients and others coming into contact with the health professional or practice. Tego Insurance Pty Ltd is not responsible to you or anyone else for any loss suffered in connection with the use of this information.
Eric is the CEO of Tego, an insurance agency offering specialist indemnity insurance solutions for the healthcare and life sciences sectors. His qualifications include a bachelor’s degree in business and law, a master’s degree from UNSW in law and management and an MBA from the AGSM.