Here’s why doctors should consider professional indemnity insurance

Magsaysay award winner Dr Ravi Kannan is credited with leading the widely admired Cachar Cancer Hospital and Research Centre in Assam. He started with a staff of 23 people and this grew to 451 over a period of around 17 years, providing free or subsidized cancer care treatments to an average of 5,000 new patients annually. While Kannan serves as a shining example for all and brings an aura to the medical profession it deserves, the healthcare profession is not without its challenges. A large urban population has increasingly come around seeing healthcare as a consumer service. Much like with every other sector, consumer expectations are rising from healthcare as well. Small unfulfilled expectations now lead to court complaints and litigation against doctors. Courts have concurred that a section of people are prone to sue doctors and hospitals at the slightest opportunity.

Litigation against doctors is relatively easy as patients can file their grievance in the district consumer forum, where the patient resides. While various doctor bodies have pleaded with courts that doctors should not come under the purview of Consumer Protection Act (CPA), 2019, courts have ruled otherwise. As compared to the 1986 CPA, the latest one has become more consumer friendly. For example, the definition of unfair trade practice has been broadened to include practices such as not issuing proper cash memo or bill or disclosing personal information of the consumer to any other person not in accordance with the prevailing laws, thus making doctors more vulnerable.

Courts have set several precedents holding doctors accountable for negligence. In one case, where a baby was born pre-term at 32 weeks, no advice was given to the family to have the ROP (retinopathy of prematurity) test. Later, the baby was diagnosed with ROP Stage 5. The family was from a humble background, as the father worked as a security guard. The case lasted for around 15 years. The courts accepted the plea of the patient’s family and awarded compensation of more than ₹75 lakh. In another case, the husband of the patient was a doctor himself and an NRI (non-resident Indian). The courts found the doctors and the hospital negligent of wrong prescription and not providing adequate nutritional support. The compensation awarded was around ₹6 crore. The diverse socio-economic profiles of the plaintiff, the kind of cause, and the compensation awarded, only goes to underline the legal liability exposure of doctors.

To be sure, not all litigations are driven by doctor’s negligence. Some studies have estimated that only in around 30% of cases, the negligence of doctors is proven. Around 70% of cases get dismissed. Notwithstanding, doctors must pay legal costs to defend themselves in court. Estimates indicate that in around 85% of cases, doctors paid legal costs from their own pockets. This can be a major drag on their finances, besides affecting them psychologically.

A professional indemnity insurance for doctors helps cover these expenses. This covers potential claims arising from errors, omissions, or negligence in their medical practice. The policy pays for the cost of lawyers to defend the doctor in court. In case the courts rule against the doctor, the policy also pays for the compensation awarded by the court. In a few cases, where required, an out-of-court settlement is also facilitated by the policy. Doctors undergo severe distress when a court notice arises. This stems from their general lack of dealing with legal matters. In such a scenario, a quick consultation with a lawyer and a clear prognosis is what comforts them the most. Knowing that someone has your back takes away the anxiety substantially. The policy is also relatively inexpensive. For a cardiologist, a policy of ₹2 crore sum assured costs less than ₹10,000 per annum. The rates differ by specialty and sum assured. (Disclosure: My firm has been serving doctors for over 10 years now.)

During his journey, one of the challenges that Dr Kannan faced was the low patient compliance rate. It was at 28% when he joined. He managed to take the compliance to 70%. But this was not without its fair share of obstacles. Many hurdles were non-medical such as food and lodging, employment for caregivers. etc. One must see legal liabilities in that context – a professional hazard that needs to be overcome. Litigation, whether frivolous or otherwise, is likely to only go up. It is best for doctors to mitigate that through an insurance and freely go about setting new benchmarks for public service.

Abhishek Bondia is principal officer and managing director, SecureNow.in.