Clinic insurance is something not talked about amongst the private clinic fraternity in Malaysia. Since the introduction of compulsory professional indemnity insurance for doctors in Malaysia for APC renewal, this interesting issue has caught my attention so I did some research about it and decided to write something.
Medical Clinic Insurance is Not the Same as Professional Indemnity Insurance
If you are a private practising GP, your clinic structure might be either sole proprietorship, partnership or Sdn Bhd. This means that your clinic business is an entity in itself.
In the unfortunate case of malpractice and the patient decides to sue, not only can you be sued in your capacity as the doctor, but your clinic can also be sued! This double whammy can be devastating if you don’t take steps to insure your clinic, on top of your own professional indemnity insurance.
Many doctors make the mistake of thinking that their individual insurance policies will cover the costs of legal representation for their clinics should the clinics be named in a suit. Please remember that this is not the case.
Medical Clinic Insurance May Protect against Multiple Risks
A medical clinic insurance not only insures against malpractice claims, but also other conventional hazards such as fire, theft and natural disasters.
I found a sophisticated product overseas that protects not only against physical damage, but also general liability and loss of income. Unfortunately there is a dearth of information about clinic insurance in Malaysia. This shows that there is lack of demand or awareness about it.
Clinic Insurance for Sole Proprietors
Some professional indemnity insurance policies also provide cover extension for sole proprietorship or partnership clinics.
MEDEEND Clinic Insurance
The MEDEFEND policy defines the same under Clause 2.3 of the Certificate of Insurance (COI) shown below:
And the Named Insured definition is further explained in clause 3.50:
Here’s what MEDEFEND rep has to say:
If your clinic is under sole proprietorship or in a Partnership (limited to one clinic), we are pleased to confirm that there is an extension cover under MEDEFEND for Indemnity for Sole Proprietorship or Partnership. But if the clinic is registered as a Company Sdn Bhd there is no coverage under MEDEFEND for your clinic. You will need to buy a separate liability cover to protect your clinic including your employees.
EXAMPLE:
Dr Z has an active policy with MEDEFEND for 2020 coverage of RM1 million limit of liability. Dr Z owns Klinik Z, a private medical clinic (Sole Proprietorship).
· Jan 2020: Patient collapsed in Klinik Z after receiving treatment by Dr Z
· Dr Z received a Writ naming him (1st Defendant) and Klinik Z (2nd defendant) in June 2020
· Dr Z notifies MEDEFEND on the claim and Insurers appoint panel solicitor to defend Dr Z and Klinik Z (because Dr Z is a sole proprietor)
· Trial on-going: Judge finds both Defendants Dr Z and Klinik Z liable and ordered award to Plaintiff for RM1 million with Apportionment of 50/50 between the 2 Defendants
· Insurers will pay the damages of RM1 million from the limit of liability that Dr Z has purchased with MEDEFEND to pay for both Dr Z and Klinik Z
However, if Klinik Z is a registered Company Sdn Bhd, MEDEFEND will only cover Dr Z’s portion which is RM500,000. (Subject to policy terms and conditions).
Doctor Shield Clinic Insurance
Doctor Shield, which is a relatively new offering in Malaysia, also has this feature called Sole Trader Extension™. Here’s what they say about it:
Should your clinic be named in a suit, your individual insurance will trigger the coverage for the legal representation of both.
Doctor Shield on LinkedIn
I believe this offers peace of mind for practicing private clinic doctors who operate on a sole proprietorship basis. Doctor Shield offers such insurance which can be purchased online instantly, which offers convenience at a click of a button.
Clinic Insurance in Malaysia – Room for Growth
I believe that the field is relatively untapped as many doctors are still not aware about this.
Please also note that clinic insurance is much more competitively priced.
If you’re a GP doctor with own practice, I highly recommend you look into this as soon as possible to protect your interests and reputation.
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