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- Why shouldn’t I treat my medical indemnity like my car insurance renewal?
Why shouldn’t I treat my medical indemnity like my car insurance renewal?
24th March 2023
Seems a reasonable question on the face of it, why shouldn’t I treat my medical indemnity like my car insurance renewal, after all they are both insurance policies. Yes, they are both insurance policies, but they work in very different ways to protect you and rely upon completely different information. When reviewing car insurance most people just look at what the premium is, how much am I covered for and what is the excess. Doing only this comparison with medical indemnity insurance can leave you potentially exposed to claims, because more often than not, the premium does reflect the breadth of the cover offered. So, you only have to look a little deeper to see that it is quite a poor analogy.
Car insurance in reality is a very simplistic type of cover, even though it has a number of perils covered, as it relies on where you live, what you drive, how you drive it and your claims history. A medical indemnity policy needs to really understand you as a surgeon. What procedures do you carry out, risk profile of the procedures, how many, what is your balance in consultations, your experience, how does it mirror any NHS practice, your income derived from procedures and of course have you had any claims and what were the claims for, making it quite a lot more in-depth and personal. It can sometimes feel a bit intrusive being asked this level of information but it is really essential to enable us to get you the best cover we can at the best premium we can.
Medical indemnity does take in to account your claims history, but it doesn’t work on the same No Claims Discount basis as car insurance. Don’t expect it to drop each year based upon the same income and practice. Something I say that gets this across is ‘look at the premiums for medical indemnity compared to car insurance’, hugely different, why? Because the likelihood of a significant claim amount, even for the best surgeon by just having an off moment, is much higher than that of car insurance. You could even have a GMC investigation and you are 100% sure you will be vindicated. Legal costs immediately start building and tens of thousands of pounds are spent just to prove something that seemed so obvious.
As with car insurance, surgeons shop around for medical indemnity cover and this is of course your prerogative and what our job is, but when moving insurer you must consider the reasons why. Is it just for premium or there more reasons such as service levels, cover options or how flexible the policy or insurer can be? If you want to move insurer, make sure you have notified any claims/complaints to your current insurer. Your new insurer relies upon the information they have been given to offer you cover and if claims or potential claims have been missed out this can cause you a problem if they later develop. I always remind our clients, that early intervention and assistance in a complaint can often stop it developing in to a claim. A claim can be a very draining and anxious experience for you as a surgeon and is something to try and avoid, so discussion and cooperation early on can save a lot of this.
So, in summary your medical indemnity protects your ability to continue to practice and therefore income derived from this. Spend 15-30 minutes each year to review what you do, discuss this with your broker/insurer. You will certainly find this is time well spent.