Understanding the two types of claiming covers
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In the medical profession, there are two types of ways a claim can be made - either Occurrence-based or Claims-made. These types of cover need to be chosen upfront when taking out your medical malpractice insurance, so understanding them well is essential.
What is Occurrence-based Cover?
Very simply, an Occurrence-based policy will cover any claim that OCCURS in the period that the policy is in force. So, even if a claim comes up after the policy has been cancelled, but the incident occurred during the time that the policy was active, it will be valid.
What is Claims-made Cover?
A Claims-made policy means that both the incident and the claim notification had to have been MADE in the active period of the policy. Therefore, if a claim comes in after a policy is inactive, there will be no viable claim. No premium payment = no claim.
It is possible to obtain retroactive cover to protect you against claims which occurred before the policy period. This usually comes at an additional premium.
Which cover do Insurers prefer and why?
Insurers prefer Claims-made because it's more clear-cut and somewhat more predictable. They can close off their books when the policy no longer is in place. For an Occurrence-based policy, they will always be wondering when and if a claim will come in. And, of course, if that Occurrence-based policy only was active for say a year, they may not recoup their costs after a hefty claim. Same could be said for a Claims-based policy, however, there is no lingering claim sitting in the dark waiting to pounce out.
Which Cover is best for you?
It is always best for medical professionals to have occurrence-based cover, as this is the most comprehensive type of cover which will cover you well after retirement.
Occurrence-made cover comes at a cost which is not always affordable and hence there are many high-risk specialists that opt for claims-made cover.
At iGennix, we have specialist malpractice consultants and could provide you with a tailor-made solution for your practice
Should you be looking for a personalized solution, speak to the experts in this field today.
https://www.liabilityprotection.co.za/malpractice
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