Medical professionals — including doctors, dentists, nurses and pharmacists — can face complex and extensive claims if something goes wrong for a patient in their care. A report from the Australian Government Actuary suggests around 2,000 negligence claims are made nationally against private medical practice each year; in addition, because of the nature of medical conditions, claims may arise long after a particular consultation or event, and often take several years to finalise.

Professional indemnity (PI) insurance is compulsory for all health practitioners in Australia and New Zealand, and is increasingly recommended in parts of South-East Asia.
 
However, not all policies offer equal levels of protection. In New Zealand, for example, many medical professionals only carry discretionary, rather than assured, cover. Nevertheless, the product’s overarching purpose is to compensate claims-related costs that aren’t funded by government initiatives, such as Australia’s high-cost claim indemnity scheme or the Accident Compensation Corporation’s no-fault scheme in New Zealand. 

In recent years, PI and medical malpractice premiums have surged globally, driven by an escalation in the frequency and cost of claims. At the same time, new digital health technologies — and three years of COVID-19 — have transformed the way practitioners treat patients. For brokers specialising in this medical professional indemnity cover, the challenge is to find insurance products that have evolved to cover these new areas of risk. 

COVID-19 continues to bite

Despite a reduction in surgery-related claims over the past few years — the result of many elective procedures being postponed during the pandemic — medical PI insurers have been hit with escalated telehealth-related cases linked to misdiagnosis, as well as delayed diagnosis.

It may take some years before the pandemic’s impact on insurance claims is fully understood, says Bambang Suseno, president of the Association of Indonesian Qualified Insurance and Reinsurance Brokers. “The surgery, cardiac illness or some terminal treatments that were postponed during the pandemic are due to explode,” he explains. “More than half of insurers report an increase in later-stage diagnosis of illness due to deferred care.”

In Australia, public health care is being contracted to the private system to clear the backlog, says Kenneth Corcoran, national director of health care, aged care, life science and community services at Aon in Australia. “This is resulting in more complex procedures that may have otherwise been performed in the public system being undertaken in the private system,” he explains. 

“Clients are also seeing more complex presentations with patients having delayed health care. However, it is yet to be seen if this will have an impact on claims.”

Across the Tasman, brokers and insurers are also seeing more complaints relating to misdiagnosis or late diagnoses, often due to health practitioners being overwhelmed by the increase in patient numbers, staff shortages and administrative demands. 

“This has led, in some cases, to a breakdown in the journey between primary and specialist health care and timely communication with patients,” says Kristene Crook, executive director of professional risks at Aon New Zealand. 

“Management and support for practitioners’ own mental health and wellbeing has become increasingly more apparent and more focus has been given to this area of health by support associations and HealthNZ.”

Meanwhile, in Indonesia, Suseno sees mental-health gaps persisting. “Despite progress, plans continue to exclude mental health care or provide only minimal coverage,” he says. “Employers are left to fill the gap in other ways.”

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