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Risk and insurance essentials for healthcare professionals

06 November 2018Aon South Africa

There are few professions as emotionally and physically demanding as that of a healthcare professional. While a respected and in-demand profession, particularly in South Africa with its severe skills shortages, a career in healthcare is also fraught with risks and liabilities that can put not only professional reputation and business assets on the line but that of your personal life too.

Legal suits against practicing healthcare professionals are far more commonplace in an increasingly litigious society, and the risks to property, assets and business continuity are many and diverse. If you are running a practice or hold a managerial position in a healthcare group, there is a very strong need for a diverse range of insurance solutions to protect your career, your practice and your personal assets.

Aon South Africa, a leading global risk advisor and insurance brokerage, provides some key insights into the insurance that a healthcare professional cannot afford to be without…

1. Medical Malpractice - Over the last decade, the size and frequency of compensation awards in medical negligence cases have increased dramatically, making professional indemnity a crucially important product for medical practitioners. The cover indemnifies you against your legal liabilities for damages, including legal costs and expenses, for claims as a result of an actual or alleged negligent act, error or omission, during the period of insurance. In the absence of such a policy, you or even your business may suffer the loss

2. Business Assets Cover - covers your owned assets against losses caused by fire, lightning, explosion, storms, hail, water, malicious damage, theft, public liability and so on and covers the contents of your practice, inclusive of all fittings and fixtures, stock, medical equipment, computers as well as the physical building. Commercial vehicle insurance covers vehicles owned by the practice used for business purposes.

3. Public Liability - Public liability insurance usually forms part of your commercial building or contents cover and protects individuals, businesses and organisations against claims of personal injury or property damage that a third party suffers (or claims to have suffered) as a result of your business activities. An example is a slip and fall incident, where a patient slips and falls on a wet floor in your practice and suffers a back injury.

4. Business Interruption (BI) - Many businesses have the usual property and assets cover for their buildings, vehicles and other essential equipment. All good and well if you have an accident, theft or fire and your policy is designed to take care of the replacement of the physical assets. What happens, however, if you are also unable to trade for weeks, even months and your revenue declines or even stops altogether as a result? What would happen if you lost your practice and everything in it due to a fire? Business overheads such as rent, salaries and so on don’t go away simply because you are unable to trade and earn an income due to a physical disaster or damage to your property or equipment. This is where Business Interruption insurance is vitally important to tide your business over in terms of lost income until your business is back to operating as usual.

5. Directors and Officers Insurance - D&O Liability insurance have a vital role to play in any business, regardless of size or nature of ownership. The main purpose is to offer financial protection for investigation and defence costs together with awards for a valid claim that could be made against the personal assets of directors, officers, managers and other employees that are charged with supervisory and managerial responsibilities.

6. Cyber Risk - If your practice has a network, an internet connection and holds sensitive or personally identifiable patient data, then your business is at risk for a cyber breach. A data breach or cyber-attack can compromise this confidential information or even prevent access to vital online services, leading to reputational damage and loss of income, not to mention legal action, regulatory costs and the associated disruption to the practice.

7. Risk Management – A comprehensive risk management strategy provides a framework to understand and respond to business uncertainties and opportunities with relevant risk insight, enhancing your ability to manage your risk and make informed decisions.

8. Personal Household and Motor Protecting your personal assets is an important part of your financial wellbeing. Ensure that you have the right insurance cover in place to protect your personal vehicles, your primary home, holiday home and any investment properties. Also consider cover for your moveable property such as your household contents, collectibles and those items you take out of your home on a regular basis.

9. Medical Aid and Gap Cover - You will need access to health care for yourself and your family. To make an informed decision, consider your claims history, state of health and level of cover required by you and your dependents. Also consider the level of self-funding you are able, or willing to bear. Gap cover policies for medical scheme shortfalls are proving to be invaluable safety nets that cover certain in-hospital and Specialist shortfalls that may occur and is relatively inexpensive. You may also need to consider Employee Benefit Solutions that look at health and risk benefits such as medical schemes and gap cover for your employees.

10. Retirement Fund - Don’t neglect the implementation of an efficient, attractive and cost-effective retirement plan. With the cost of living skyrocketing and not seeming to slow down, you may need more than you initially anticipated to retire comfortably one day.

Get an expert broker by your side that will work with you to structure a cost-effective and comprehensive insurance portfolio whether you run an owner-managed private practice or a large healthcare facility.

 

Quick Polls

QUESTION

Between 1918 and 2014, 32% of all of Lloyds of London’s insured losses were caused by flooding. With Climate change becoming a growing issue, is this a growing concern for insurers?

ANSWER

Yes, we have seen a significant increase in flood related losses
No, there will always be flood related losses. We are prepared for this.