Healthcare Professionals policy cover

Medical malpractice insurance is a combination of two covers – public liability insurance and professional indemnity insurance. The policy provides cover for claims arising from bodily injury (which would include mental and psychological damage, from both physical procedures) and from advice that the medical professional provides. Policies vary from underwriter to underwriter, and from profession to profession, but tend to fall into two categories;

Malpractice – providing cover for a policyholders legal liability arising out of any bodily injury, mental injury, illness, disease or death of any patient caused by a negligent act, error or omission committed by the insured in or about the conduct of the insured’s occupation or business. The policy will also generally cover Good Samaritan Acts. Note that the schedule of cover is likely to be very specific about what types of medical occupation are covered.

Treatment Risks – this type of policy is based on the public liability wordings and is extended to include breach of professional duty consequent upon any neglect, error or omission in providing advice, treatment or prescriptions or professional services.

One major difference between the two standard forms of contract is the basis upon which a claim may be made. Malpractice insurance, similar to professional indemnity is generally written on a “claims made” basis, whilst Treatment Risks are written on a “claims occurring” basis. This means that a Malpractice policy must be in place at the time that the treatment was carried out and also at the point which the claim is made. Cover between the treatment and claim must have been continuous. Treatment risks which are written on a “claims occurring” basis need only to have been in place when the act of negligence is carried out.

Where policies are written on a “claims made” basis, it is important to ensure that the policy includes retroactive cover, to provide for claims that may arise from previous work. It is also important to appreciate that upon retirement or cessation of business, if insurance has been held on a “claims made” basis, “run-off” cover will be required to protect the policyholder in future years against new claims.