Though doctors have been revered as ‘God’ in our society, there has been a rise in some claims against them as well. In the present situation, either due to some doctors who are engaged in malpractices or hospitals who recommend unnecessary medical procedures in order to extract more money, many people are looking at doctor’s community with distrust. Now, more and more patients and their families are suing hospitals and doctors against malpractice or negligence. In case the verdict goes against them, they would have to pay hefty compensation to patients.
As a result, it is essential to purchase doctor’s professional indemnity insurance which provides financial coverage against legal claims. The insurer compensates the other party on behalf of the policyholder and covers legal expenses as well.
If we talk about the cost of doctor’s professional indemnity insurance, then the premium would depend on the sum insured, profile of the policyholder, revenue along with the risk involved. Usually, the premium of doctor’s professional indemnity insurance varies between 0.3%-1% of the total sum insured.
Those doctors who are members of a group can often ask for better premium rate. Some physicians may face higher risks than others. For instance, gynaecologist, orthopedics, cardiologists, etc.; may have to deal with more complex risks than a general practitioner, and therefore, their premiums are higher as compared to other specialists.
The doctor’s professional indemnity insurance cost can also depend on the following=
- Risk group of doctors
- Limits of indemnity selected
- Ratio of limits
Then how big your hospital or clinic also help in deciding premium rates. A multi-speciality hospital with 500-beds would have to pay more premium for doctor’s professional indemnity insurance than a hospital or clinic which have 10-beds. Then those policies which offer the most coverage cost more than those policies which offer the least coverages. Further, the premium also depends on the medical equipments used and the expertise of nursing staff.
The record of claims also helps in deciding the premium as well. It means, if in the previous year, you have filed for a heavy claim amount, you might have to pay more premium at the time of policy renewal.
Then there is deductible which helps in deciding the premium. In the insurance field, the deductible is the amount that you would have to pay at the time of claim before the insurer settles the claim. If you opt for a high deductible, your premium would be low and vice-versa.
Ajay Verma was busy in preparing for his meeting with the boss when suddenly he started feeling uneasiness and fainted. He was rushed to the hospital where initial medical reports suggest a minor cardiac arrest. The doctor started the treatment immediately and gave some medicines and injections to Ajay who died within an hour. Later the post-mortem revealed that Ajay was allergic to certain medicines and the doctor without examining his medical history administrated his medicine.
The death of Ajay not only caused emotional loss but financially troubled the family as well who was dependent on his income. His wife filed a case against the doctor for medical negligence, and the verdict was given in her favour. The doctor was asked to pay compensation of Rs 50 lakh to Ajay’s family. In this case, the doctor had to dig into his saving and sold off his plot to pay compensation.
The situation would have been different if the doctor had a professional indemnity insurance policy. The insurer would have compensated Ajay’s family on behalf of the doctor and also covered the legal expenses.
Now, the doctor should buy the professional indemnity insurance policy. Here are some of the factors which would decide the premium=
- Previous claim record
- Coverage opted for
In this case, as the insurance applicant was a cardiologist, the insurer would consider this fact and charge premium accordingly. Also, if the doctor would go with a high deductible, he can lower his cost of doctor’s professional indemnity insurance policy.