Insurance: Eight things to do before starting your medical practice

Starting or buying a practice can be one of the most exciting milestones of a doctor’s career.

However, there’s so much to do that you might forget to think about the risks involved and how to manage them.

That’s why it’s important to get tailored advice from an accountant and a lawyer well in advance of seeing your first patient, says Eric Lowenstein, the CEO of Tego medical indemnity insurance.

Discuss what can go wrong and how each risk can be mitigated, he says. Then speak also to a medical specialist insurance advisor.


When first setting up your practice, you will need to consider the following types of insurance, apart from compulsory medical indemnity insurance, to ensure you are fully protected;

  • Business Package Insurance: This will typically include public liability, property cover including equipment and fitout, theft, business interruption and equipment breakdown.
  • Practice Indemnity Insurance: In your new practice, you are likely to be assisted by nurses, practice managers and receptionists. There are many exposures involving the interaction between your staff and patients that may not be covered under other policies. The legal structure of your entity (soletrader, trust, company) may also have an impact on how the policy is set up, so it is important to discuss this with your broker or insurer.
  • Management Liability
  • Network Security and Privacy
  • Income Protection and Business Expenses Insurance

Medical indemnity Insurance

These tips should help you on your way:

  1. Make a list: Identify your top five or ten risks and review these regularly. Here are some examples:
    • Medical Indemnity Insurance. 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.
    • Practice Indemnity Insurance. While not compulsory, there are exposures a practice may face that will not fall within their own medical indemnity cover. If you are buying an existing practice, ask your insurer if you are covered for events that occurred under the previous owners.
    • Injury to staff or patients
    • Cyber-attack
    • Privacy breaches
    • Damage to premises, including the fit-out
    • Loss or damage to equipment
    • Loss of revenue or personal income
    • Director’s responsibilities
    • Employment issues
    • Theft by employees or third parties
  2. Appoint a risk champion. It could be yourself, the practice manager or another trusted person.
  3. Set up a risk register. Every doctor and staff member must be obliged to record every incident, no matter how trivial they think it is. It is a good idea to make it someone’s job to send everyone in the practice an email each month asking direct questions about any incidents or near misses. Headings on the register can include:
    • Date
    • Description of incident
    • Remedial action
    • Outcome
    • Suggestions for avoiding future incidents
  4. Discuss regularly. Include a report from the risk register as a standard agenda item at your monthly or quarterly management meetings and ensure every staff member and contractor is aware of every incident so that you can all learn from each other’s mistakes.
  5. Compile policies. These should cover privacy, IT security, emergency procedures, HR.
  6. Stage drills and role play. Be creative and include fire, medical emergencies, angry patients and missing pathology reports or patient files.
  7. Share knowledge. Hold an annual risk workshop covering topics such as dealing with privacy, cybersecurity or following up with patients if a colleague is on leave.
  8. Review annually. This could include levels of cover and types of insurance as your needs change, and don’t be afraid to call for comparative quotes.

Regardless of how much insurance cover you buy, Lowenstein notes three things you can’t insure:

  • Your reputation
  • The risk of losing good staff; and
  • Your personal health and wellbeing.

“Take care. These are potentially your most significant risks,” he says.

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.