FANews
FANews
RELATED CATEGORIES
Category Healthcare
SUB CATEGORIES General  |  HIV |  Medical Schemes | 

Medical Practitioners must be insured

09 September 2010 Michelle Schreuder-Rankin
Donald Dinnie, Director, Deneys Reitz Inc.

Donald Dinnie, Director, Deneys Reitz Inc.

Regulations published on 30 August 2010 under the Health Professions Act require health practitioners, which include doctors, specialists, dentists and psychologists practising for their own account, whether in partnership, association or by way of a company allowed for in the Act, to obtain professional indemnity insurance. The insurance must be obtained from an insurer registered under the Short-term Insurance Act.

The requirement does not extend to those practitioners employed, for example, by the State at provincial hospitals. That is presumably on the basis that the State is liable for the negligent conduct of those professionals and has the financial means to meet any judgment.

Medical practitioners have not previously been required to be appropriately insured for medical malpractice claims. In some circumstances, patients with meritorious medical malpractice claims against practitioners have found the practitioner to be uninsured and without any funds to meet a judgment.

So much for the good news!

There are problems with the regulations.

The extent of the insurance cover required is not stipulated. Even cover of R10 000.00 per an event is wholly inadequate. On the face of the regulation, a medical practitioner who obtains professional indemnity cover for R1.00 will comply with the regulation. The regulation is also silent on what would be considered adequate cover in the aggregate. For example, where an obstetrician obtains cover for an exposure of say R10m for any claim, that is well and good but will be of a limited benefit where there are two or three such claims. The aggregate should therefore not be limited to the amount of a single claim. A greater annual aggregate of all possible claims is needed. The question also arises whether the cover must be taken out for claims made during the insured period. Nor is provision made for any run-off cover. For example, a doctor will comply with a regulation where at all times while practising, the doctor had maintained a professional indemnity insurance policy in place but immediately the practitioner retires, the policy ceases. Cover is therefore needed for all claims that arose during the practitioner’s working life during which the professional indemnity cover was maintained. Because of the general three year prescription period and a longer period (up to 19 years) when the patient is a minor, a claim may only be made against the practitioner well after retirement or when the practitioner has ceased to practise medicine and embarked on another career. These issues should have been dealt with. Where a practitioner has indemnity cover from an entity other than a short-term insurer, for example, through membership of a recognised society or organisation such as a medical protection society, then that society or organisation has to register as an insurer under the Short-term Insurance Act within four months of 30 August 2010.

That four month registration period is clearly too short and extensions may have to be granted.

The regulations are promulgated under a section of the Health Professions Act which allows the Minister of Health to determine conditions under which a practitioner may practise, after consultation with the Health Professions Council. It is presumed that the appropriate consultations were held and that the effect of requiring indemnity cover to be obtained only via a registered insurer was duly considered. But was this attempt to force medical protection societies to register as insurers subject to proper consultation?

Practitioners with an independent practice who currently have indemnity cover via membership of a recognised society or organisation will have a four month period of grace within which to obtain insurance through a registered insurer. That may involve the relevant society or organisation obtaining the appropriate registration, alternatively, the mounting of any successful challenge by the relevant society or organisation to the regulations or insuring for limited losses only.

Quick Polls

QUESTION

South Africa’s economy is facing major policy and market challenges in 2025. As an adviser or broker, what concerns you the most?

ANSWER

Erosion of private property rights
Government interference in free trade
Inflation, administered prices
Weak growth, high debt
fanews magazine
FAnews February 2025 Get the latest issue of FAnews

This month's headlines

Unseen risks: insuring against the impact of AI gone wrong
Machine vs human: finding the balance
Is embedded insurance the end of traditional broker channels?
Client aspirations take centre stage as advisers rethink retirement planning
Maximise TFSA contributions before year-end
Subscribe now