What is the Claims Series Clause in Doctor’s Professional Indemnity policy?
The Doctor’s Professional Indemnity policy has various clauses. Here we will look at the ‘Claims Series’ clause.
The claims series clause plays a crucial role in determining the limit of deductible payable for the insured.
Accumulated claim amount
This clause is applicable when different claims arise from the same cause of neglect, error or omission. In such cases, the insurer adds all claim amounts. This determines the allocation of deductibles.
Let’s look at this instance. A hospital got a Rs 50,000 compensation demand for negligence. However, the patient suffered a complication and had to undergo an operation. This cost the patient an additional Rs 2 lakh. Since both claims arose from the same case of negligence, the hospital was asked to pay a single deductible for the first claim. The deductible limit was not applicable for the second claim.
This clause, however, works on one condition. It will not be applicable for any other claim that arises due to the same cause after 3 years of the first claim.
Let’s look at another instance. A hospital reported a claim under the DPI policy in 2010. It later renewed the policy for 6 years and made another claim due to the previous incident in 2015. This claim was, however, raised after 3 years. So, the deductible limit did not apply for the second one.
A doctor at A.B. Hospital is accused of prescribing the wrong medication, leading to an allergic reaction in a patient. The doctor’s professional indemnity policy covered the claim amount after the insured paid the deductible. However, six months later the patient came to know that excessive intake of prescribed medicines had damaged an organ.
However, this time the insured doctor was not asked to pay the deductible amount since the second claim was related to the previous incident. Thus, the insurer bore the legal costs without the insured paying any deductible.
The Claims Series Clause clause is applicable in all liability insurance policies. It determines the coverage amount that the insured has to pay due to a series of losses.
Connect with us on Linkedin