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COMBINED MEDICAL MALPRACTICE AND LIABILITY COMPARED TO LIABILITY WITH A TREATMENT EXTENSION
During October ProRisk, in conjunction with DLA Piper, Fox Tucker and Dobson Mitchell & Allport Lawyers, conducted Seminars around Australia. One of the areas of discussion related to the Medical Malpractice/Allied Health arena and following the Seminars we have been contacted by numerous brokers asking for further information. In this months Bulletin Gary Gribbin, the Underwriting Director for ProRisk provides further commentary around the difference in cover afforded to Allied Health Professionals by a Medical Malpractice Combined Liability policy in comparison to a Liability policy with a treatment extension.
Caveat: Liability policies with a treatment extension are offered by a number of insurers active (in particular) in the beauty and hairdressing segments and in some allied health areas. The wordings and extent of cover vary considerably between insurers. Some provide occurrence-based protection for liability and claims-made protection for treatment risk; only one provides occurrence protection for both. There are also substantial differences between insurers in terms of the fundamental cover provided. One prominent insurer (and some others) confine cover to negligence, whilst others extend cover to embrace some of the benefits of a civil liability form.
Brokers need to exercise great vigilance to ensure that their professional position is not exposed by the differences – often subtle – between carriers. One effective risk management strategy for brokers is to effect combined Medical Malpractice and Liability coverage which incorporates the significant features of the civil liability form.
This bulletin is not intended to provide legal or market advice in relation to this topic. The information is given to alert brokers of potential issues that can arise and is of a general nature. For information in relation to specific policies, you should seek independent legal advice.
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ProRisk Medical Malpractice Combined Liability coverage:
This policy incorporates Medical Malpractice and Liability coverage and includes the major features of the civil liability form. Both the Medical Malpractice and Liability cover are claims made. Cover is automatically extended to goods sold and/or supplied and may be extended via a stand-alone policy, to cover product liability if manufacture/distribution/repackaging is undertaken.
Very importantly, cover extends to include:
 Defamation, libel and slander (invariably excluded from liability policies);
Breach of confidentiality;
Dishonesty (not usually covered by liability policies);
Intellectual property (not usually covered by liability policies);
Competition and Consumer Act actions (usually, if not always excluded from liability policies);
Loss of documents;
Legal costs associated with representation at inquiries etc (sometimes covered but very often not by liability policies);
Cover for the acts and/or omissions of students or locums;
Vicarious liability for employed doctors (which is also invariably excluded by liability policies).
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Liability policies with treatment extension:
The difficulties for brokers in using this option may be summarized as:
Firstly, the limitation of cover for treatment risk can be for “negligence” only. This only provides a very narrow level of cover ; one which ignores other possible torts and liability issues that may arise in modern society; and
Secondly, the absence in many instances of cover for civil liability type issues such as breaches of confidentiality/privacy; intellectual property rights; costs of legal representation at inquiries etc.
Again the point is made, because it cannot be overemphasized. If you are using liability policies with treatment extensions you must exercise great diligence to make sure you understand the extent and limitations of the cover being obtained for your client. Ultimately, it is your PI insurance that may be exposed!
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Did you know
ProRisk is best known as a specialist in Professional Indemnity and Medical Malpractice insurance but did you know that we can also offer:
Public and Products Liability
Personal Accident
Specified Items in Transit (Tools of Trade)
Management Liability
Information Technology Insurance
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Feel free to contact a member of the team with any queries.
ProRisk your problem solving underwriting solution.
Email: enquiries@prorisk.com.au
Phone: 03 9235 5255
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