Drawing the line between business and personal insurance for healthcare professionals

For many healthcare professionals, there is often a blurring of lines between personal and business roles and this can even extend into insurance planning.  It becomes especially important in a world where work environments are evolving, and more practitioners like dieticians, chiropractors, physiotherapists and psychologists set up home-based practices.

Asset Insurance
“If you’re a health professional running a practice from home, it can be tricky knowing when something should be covered under your personal insurance policy or your commercial business insurance,” says Clayton Ellary, Commercial Branch Manager at Aon South Africa. “The definitive factor that separates a personal lines policy from a business policy is the nature of the risk involved,” he adds. 

Your personal insurance policy will not cover you for risks arising from business or commercial pursuits.   “While your homeowner's policy may cover you for your home office structure as part of the insured building, it won’t protect you against claims arising from your business pursuits. For that reason, you should obtain a separate commercial policy to cover your business assets as well as any third-party liability when someone visits your premises,” says Clayton.

“The inventory of assets alone is vastly different between that found in a typical home and the specialised equipment utilised in a medical practice. Losing your stock, equipment and important IT assets such as laptops or servers can be a huge loss, not just financially, but reputationally too.  Consider equipment utilised by a physio-therapist or chiropractor, not to mention any medical equipment that may travel with you if you do locum consults,” explains Clayton. 

“A commercial insurance policy is geared for fire risk, accidental damage, theft and loss, as well as any third-party liability risks that your medical practice could face.  This is why it is crucial to do a thorough needs analysis to ensure that your practice is covered for every possible scenario,” says Clayton. 

Professional Indemnity
Liability is an important aspect of any healthcare professional’s stable of insurance, regardless of the size of the practice.  “Professional indemnity cover is essential, especially if you consider the increasingly litigious nature of society,” says Carol-lee Axford, Aon South Africa’s Principal Broker (Professional Risks).

While Professional Indemnity (PI) insurance is not compulsory for healthcare professionals, industry bodies such as the Health Professions Council of SA (HPCSA) are increasingly of the opinion that it should be.  Professional Indemnity insurance protects you for any damages that may be claimed from you by patients or third parties as a result of an act, omission or breach of professional duty in the course of your profession, as well as onerous legal costs associated with defending a claim. 

“Hospitals also insist that practitioners provide proof of PI cover in order to operate within their facilities.  This includes consulting rooms that are isolated from the administration of hospitals and rented out to medical practices,” explains Carol-lee. 

How to protect your practice
Risk management is at the heart of the matter and it is crucial for any healthcare practitioner to evaluate the potential risks that they face in their day to day business and actively address them.  Start by consulting with an expert broker who understands the risks faced by healthcare practitioners,” says Carol-lee.  

“While a liability claim may seem highly unlikely for a private practice, they can and do happen and typically spell financial ruin without insurance cover,” warns Carol-lee. 

“A broker with sector-specific experience is invaluable in ensuring that your cover is adequate to cover your specific industry risks, that it complies with any professional body or legislated requirements, and that you are not exposed under any exclusions and conditions that may exist on your policy.  Aon also provides Legal Risk Management Services, a premier service offering out of Aon Professional Risks, exclusively available to our clients,” says Carol-lee.   

Against the background of a greater recognition of the specific risks and liabilities facing healthcare professionals, Aon South Africa and MediCoop CFI have reached an agreement whereby Aon provides a range of short-term insurance solutions for MediCoop’s members which include doctors, nurses and healthcare workers.  The agreement paves the way for new healthcare practitioners entering the daunting practice environment, often fraught with risks and liabilities that can put professional reputation and business and personal assets on the line.

MediCoop Managing Director, Theuns Botha, adds, " MediCoop offers a financing option to health professionals setting up a practice - Asset Rental Finance - which addresses the problem of keeping up with new technologies. Basically, the client rents the equipment and when the agreement comes to an end, they can simply replace or upgrade equipment where needed."  

MediCoop’s Asset Rental Finance Solutions are flexible. MediCoop offers various structuring options to suit a new practice's requirements along with regular technology replacement cycles for high-end users and flexible end-of-term options, including ownership, early upgrade or residual balloon structures. It is also all-inclusive with no deposit required. Insurance and maintenance can be structured into the monthly premium as well.