Insurance issues for GPs - your questions answered
We have been asked by a number of practices recently about issues relating to clinical negligence insurance when practices establish different vehicles to tender for and, if successful, operate contracts. Below we have set out a case study which should hopefully answer some frequently asked questions
The scenario
A new limited company ("the Company") is established by a group of healthcare professionals to tender for a PMS contract. The PMS contract requires that there is clinical negligence insurance in place. This leads to a number of questions which we have posed below to a leading broker specialising in this area.
Q1 - If the healthcare professionals providing the services are already personally insured is this sufficient?
No, for two reasons. Firstly whilst an individual practitioner may be sued for negligence, a patient may seek to claim against the Company. For example, if it is alleged the Company failed to supervise effectively. Secondly the Company may be vicariously liable (this is when a company is liable for the actions of its employees), for example for the actions of a practice nurse. The Company must also consider the different types of insurance contract, whether they be on an occurrence basis or a claims made basis.
Q2 - If that is the case do the healthcare professionals providing the services need to be insured too?
Yes, it is usual to see that a condition of the Company’s' policy is that doctors, dentists and any other healthcare professionals providing services need to have their own personal policy in place. The Company must build and maintain a robust system to check and to record the details of all personal policies in respect of all of the professionals providing the services. The same policy must be adopted in respect of locums particularly those from outside the UK.
Q3 - Upon the termination of the PMS contract are there any insurance issues we will need to consider?
Yes. As mentioned above they Company needs to determine if the insurance is on a claims made basis or an occurrence basis. A claims made policy will cover incidents which are reported during the term of the policy only and therefore may give rise to a requirement for "run off" over (this is insurance to cover claims which arise post termination). An occurrence basis will respond to incidents arising during the period of the policy even if reported after the policy has expired so "run off" cover many not be needed in these circumstances. This is a complicated area and you will need specialist advice to determine whether you should consider "run off" cover.
We hope that this case study has answered your questions on insurance but if you have any further questions please contact Anne Fairhurst on 0161 234 8807
