A number of SA medical professionals do not have medical indemnity cover due to the rising costs of insurance premiums. Norton Rose Fulbright's Natasha Naidoo argues that a British 'union style' product might be the answer.
In October 2017, the British Insurance Brokers’ Association launched a new scheme with Lloyd’s broker, Servca, who are known for specialising in medical indemnity insurance that offers medical professionals who are clients of BIBA “union style” medical indemnity cover at highly competitive premiums. Natasha Naidoo, associate designate at Norton Rose Fulbright writes that the result is a specialised product which meets the needs of medical professionals faced with claims made by patients.
This follows the recent judgment in England’s High Court of Appeal where gynaecologist, Roderick Irvine, was struck off the medical register after a patient brought a lawsuit against him for alleged professional negligence. Irvine was struck off because he had failed to renew his annual membership with a well-known indemnity provider for a considerable period of time.
Naidoo writes that there are presently no regulations in place in South Africa which compel a medical professional to take up medical indemnity insurance. However, medical professionals working at private healthcare establishments are usually, in terms of their contracts, obliged to ensure that they have medical indemnity insurance.
But, Naidoo notes: “A number of medical professionals do not have cover due to the rising costs of insurance premiums. This is a cause for serious concern since medical indemnity cover ultimately goes towards compensating patients in the event of a claim. Medical malpractice matters are often long-drawn-out and it may take many years before a matter comes before the courts. A medical professional who does not have medical indemnity cover in place will be liable for payment of legal costs incurred in defending the claim. There is also the risk of a successful judgment being handed down by the court in favour of a claimant. Failure on the part of the medical professional to ensure that he or she has medical indemnity insurance cover in place may result in the medical professional having to settle a claim from cash on hand in the event of an unfavourable judgment.
“The introduction of a union style product, similar to that offered by organisations such as DENOSA, which offers medical indemnity cover to medical professionals in South Africa would help solve the challenges faced by those medical professionals who currently practice without cover and who run the real risk of facing medical malpractice lawsuits. A tailor-made product which offers a 24 hour legal helpline to medical professionals, legal representation, cover for defence costs, run-off cover, flexible limits, variable excess options, as well as access to in-house medical experts for professional advice will likely appeal to those medical professionals who do not have such cover in place.
“Cover is determined according to each member’s needs. Premiums are negotiated with the end result being that medical indemnity cover is made more affordable to members. The added benefits could possibly include discounts on premiums which are paid upfront. Members stand to benefit from training sessions and seminars which may be offered by the organisation as a hands-on risk management measure at affordable reduced tariffs. The introduction of such a product in South Africa would provide consistency to medical indemnity insurance premiums thus alleviating some of the cost pressures faced by medical professionals.”
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