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What is the future of the Medical Indemnity Market?
29th September 2023
Simon Downing, Managing Director of MIC (Medical Insurance Consultants) PRASIS Scheme Brokers writes:
The medical indemnity market always seems to be in a state of flux, perhaps more noticeable from the inside. Brokers and providers appear who think they can tap in to the market and offer something new, in reality they offer a simple rehashing of what is already available.
In addition to this there is the drawn-out review of the Medical Indemnity market post Paterson being undertaken by the Department of Health (DoH). I don’t envy them the task, but I feel it has a simple answer, albeit not a politically easy one. Having sat on a recent roundtable event by the DoH on this very topic I do feel the most important question is not being answered, just musing ‘what can we do if?’. To answer the question simply, the whole medical indemnity cover market should be regulated, by the same regulator, to achieve fair and reasonable outcomes for policyholders. At the moment it would seem from the outside to be quite a dis-functional set up, different cover, regulated and not regulated, transparent and opaque, contractual and discretionary, taxed and untaxed, legal recourse and none. Simple logic would ask why are we allowing a two-tier system of coverage to apply to such a sensitive market?
Then there are the new entrants to the medical indemnity market - some of whom offer the world, others of whom offer (limited time) reduced premiums. Of course, we all want to make sure we are getting the best deal we can, but I advise caution when considering ‘flip flopping’ between different providers. Loyalty and insurer knowledge of your practice can serve you well, providing a consistently stable premium. This contrasts with the experience of some who switch insurers for a year only to be faced by a premium which then goes up for no apparent reason, putting them in the position of thinking of switching again, and risking entering a cycle which weakens their insurability.
As a market, the medical indemnity market is quite a specialised one, and rightly so. Not only do we need to know about insurance contracts and coverage, but also have a good grasp of medical procedures and innovations within medicine. So often I see people who have sold physical products to the medical market and think the indemnity market looks profitable, so have dabble, with a worrying low level of insurance contract knowledge. My advice, stick to the brokers/providers that have been in the market for sometime and have well established connections, resulting in a deep knowledge of what works best for you. Might not always be the cheapest, but that is same for any type of insurance cover you take out, as you generally get what you pay for.