Insurance Vs Indemnity
Dentists are frequently bombarded with marketing information from commercial insurers (and other interested parties), proclaiming the supposed benefits of insurance over the flexible discretionary indemnity offered by non-profit making organisations like Dental Protection.
Remember that 70% of dentists continue to choose Dental Protection over insurance. If in doubt seek the advice and opinions of your colleagues.
Below are some of the most frequently asked questions on the issue.
Q1. What's the difference between mutual (not-for-profit) and commercial (profit-making) indemnifiers?
Commercial organisations are profit-focused, their priority is to protect the financial interests of shareholders. In a mutual organisation the priority is the interests of the members. The wording of any insurance policy will reflect the need to define (and thereby limit) what will be covered. The terms, conditions and exclusions contained in an insurance policy will be designed to minimise risk, thereby protecting profits and the interests of shareholders rather than the policy holder.
In contrast, Dental Protection is run purely by members of the dental team for members of the dental team and is non-profit making.
Q2. Does a contract of insurance automatically provide more certainty than discretionary indemnity?
No. The level of certainty will depend entirely upon the nature of the contract and its detailed wording. This determines what is included and what isn't, what exclusion clauses apply, what the terms and conditions of cover and claims are, and what the limit on cover is for each claim. For instance, bleaching is currently not covered by many insurance policies
Occurrence-based indemnity provided on a discretionary basis offers greater flexibility, and enables assistance (and compensation) to be given in circumstances which would not be covered within a contractual insurance situation. Anyone who has ever fallen foul of the small print of a car, property, travel or permanent health insurance policy will confirm that the only 'certainty' is that commercial insurers will do their best to avoid paying out on claims.
Q3. Can't a discretionary indemnifier just refuse assistance?
For commercial reasons, insurance companies will tend to use arguments such as this to undermine confidence in discretionary indemnity. Such an argument, while compelling at first sight, ignores the fact that an insurer can and will refuse cover if the circumstances fall outside the terms of the policy, or if the policyholder fails to comply with the conditions of the policy. Beware the bold headline statement accompanied by a tiny footnote which normally reads 'subject to the terms and conditions of the policy'.
Any discretionary organisation that refused legitimate claims from its members would not remain in business for long. In 118 years of continuously indemnifying UK dentists, no patient who has suffered harm as a result of clinical negligence on the part of an MPS member, has ever gone uncompensated as a result of MPS exercising its discretion negatively.
Is is also unlawful for discretion to be used unfaily, randomly, perversly, irrationaly, or with improper motives, and discretionary organisations are subject to legal challenge in the courts and berfore tribunals of various kinds. The discretion must
be used in accordance with the objectives set out in the Memorandum and Articles od Association
Q4. What's the difference between the occurrence-based indemnity from Dental Protection and the claims-made cover offered by commercial insurance?
Put simply, occurrence-based indemnity can meet claims that arise from treatment carried out in the past without the need for any further premium to be paid, and can protect the member in perpetuity.
Claims-made insurance only covers you for the period for which the policy is in force. Claims from the past may have to be covered by the payment of an additional premium or run-off cover. If run-off cover is not taken out in these situations, the dentist, their estate and patients with a retrospective claim will not be protected. This is in effect a 'hidden' cost and risk of insurance.
Q5. Discretionary mutual organisations are not regulated in the same way as insurance companies. Are they less secure?
Regulation of commercial insurers is no guarantee of security. The failures of Equitable Life, and of the Independent Insurance Company, are recent examples here in the UK which explode this myth, both having been subject to FSA regulation up to the moment of their demise.
Q6. Entering Practice- Why Choose Dental Protection?
Q7. When do I renew with Dental Protection?
- We are the only organisation that gives you 14 months membership (the other organisations only give you 12), so you will be covered by us until the September, 12 to 15 months after you graduate. You will receive our renewal in early August of that year.
Q8. What if I join more than one organisation?
- Most people do. It is natural that you will join lots of different organisations during your final year and take advantage of the different incentives and discounted prices. This is fine during your first year after graduation when the subscriptions to these organisations is heavily discounted. Decision time comes when you complete your VT year when it is no longer feasible to continue membership with more than one indemnity provider. Do your research and ask friends and colleagues for their opinions about the different indemnity providers to help ensure you make the right choice. You can always call Dental Protection if you have any questions about the differences between the organisations.
Q9. Am I locked in to future membership?
- No! We believe in choice and that you should choose how you pay for your membership. We give you the option of paying by cash, cheque, card or direct debit. This is not the case for all organisations, with some insisting that you pay by direct debit as a way of 'tying' you into membership. Be aware of this when you reach the end of your VT year. We give you 14 months indemnity beginning when you start work. If you plan to renew with Dental Protection, you must cancel any unwanted direct debits with other organisations before the start of June, so money cannot be unexpectedly claimed from your account before then.