8 December 2009
Q. I asked to see a certificate of indemnity from a new associate that I want to employ. The dentist in question showed me a broker’s certificate for a policy backed by Lloyds but which had an excess of £5,000 for each claim. Is this valid?
Several brokers offer insurance policies that are backed by Lloyds. It is a proper insurance, of course, but you should pay attention to the £5000 excess on each claim. You might want to consider the best way of ensuring how a patient would receive the full amount of any award if a claim should ever arise. Perhaps you should ask the associate to deposit £5,000 in an escrow account as a contingency measure?
You might also want to consider why this dentist is not with one of the normal indemnifiers. It is not inconceivable that the associate had conditions applied or had possibly been refused by a previous indemnifier.
If the associate is being employed as a performer then has the PCT seen his policy and accepted it? If not, then you will need to look at their response before you decide on the best way forward.
Although the every dentist is responsible for their own omissions and errors, if the associate subsequently leaves the practice it is possible that that any complaint about a former associate may become the vicarious responsibility of the practice. In this case the associate will need to purchase ‘tail-cover' from the insurer to indemnify themselves against any cases that may come to light after they have left your practice. Unlike the occurrence-based indemnity offered by Dental Protection, claims-made insurance only pays out whilst the policy is in force. Once the contract of insurance providing indemnity has lapsed no payout will be made against a claim unless additional retrospective tail-cover has been purchased.
Most claims arise some years after the treatment was provided. Unless the associate has occurrence-based indemnity, such as that offered by Dental Protection, the practice owner needs to protect themselves against any vicarious liability by ensuring that suitable arrangements have been put in place for any period that the associate works for you.
In conclusion, the policy you describe is a valid type of insurance but perhaps warrants a few more questions to the associate.