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					Requirement for professional indemnity for GDC registrants
 1.   An amendment to the Dentists Act 1984 which came into force on 31 July 2006 gave
      the Council the power to make rules under the Act to require all dentists to ‘be covered
      by adequate and appropriate insurance throughout the period during which he is
      registered in the register’. There are effectively identical provisions requiring dental
      care professionals (DCPs) to have adequate and appropriate insurance in relation to
      each title under which they are registered.
 2.   The Dentist Act defines ‘adequate and appropriate insurance’ as ‘insurance of a type
      and amount which the rules under this section specify as adequate and appropriate’
      and ‘insurance’ is defined as:
          a contract of insurance providing cover for liabilities which may be incurred in
           carrying out work as a dentist (or as a member of a profession ‘complementary to
           dentistry’); or
          an arrangement made for the purpose of indemnifying a person against such
           liabilities.
 3.   This means that rules can include both insurance and discretionary indemnity, if we so
      choose.
 4.   Under these statutory powers, the Registrar can require evidence of adequate and
      appropriate insurance as a condition of first registration, renewal of registration or
      restoration to the Register. The Registrar also has the power to require a registrant to
      provide evidence of satisfactory cover at any time.
 5.   The Council is mindful of its responsibility to make the rules, but wants to ensure that
      they are considered and not unnecessarily interventionist. In undertaking this work, we
      are conscious of the key principles of statutory professional regulation set out in the
      Government white paper Trust, Assurance and Safety – the regulation of health
      professionals in the 21st century, namely:
          its overriding interest should be the safety and quality of the care that patients
           receive;
          it needs to sustain the confidence of the public and the professions through
           demonstrable impartiality;
          it should not create unnecessary burdens but should be proportionate to the risks
           it addresses and the benefits it brings;
          it should ensure the strength and integrity of health professionals but be
           sufficiently flexible to work effectively for different health needs and adapt to
           future changes.
 The professional indemnity market in the UK
 6.   In considering drafting new rules, the Council is cognisant of the fact that there is a
      long-established market of both insurance and discretionary indemnity. This in itself is
      not a reason to make rules that would accommodate both options. The job of the




                            General Dental Council 37 Wimpole Street London W1G 8DQ
 Tel: 020 7887 3800 Fax: 020 7224 3294 Minicom: 18001 020 7887 3800 (via TypeTalk) Email: information@gdc-uk.org
      Council is to determine what is adequate and appropriate in order for patients to be
      protected.
 7.   There are three main professional indemnity providers in the UK: Dental Protection
      Limited (DPL), the Dental Defence Union (DDU) and the Medical and Dental Defence
      Union (MDDUS). In addition to these three providers, there are a number of other
      companies offering professional indemnity. Some of these are: Towergate MIA, W.R.
      Berkley Insurance and Lloyds.
 8.   Not all the indemnity providers offer the same product. There are three main
      distinctions between the two products on offer in the UK. The two products on offer are
      insurance (DDU, Towergate, Berkley Insurance, Lloyds for example) and discretionary
      indemnity (DPL and MDDUS).
 9.   The key distinctions between insurance and discretionary indemnity in the UK which
      are necessary to understand the proposals outlined in the paper are the following:
          insurance is based on a contract, while discretionary indemnity is discretionary
          insurance is commercial, while discretionary indemnity is not for profit
          insurance is claims-based, while discretionary indemnity is occurrence-based
           cover.
Background on Insurance
Contractual basis
 10. The nature of insurance is that it is based on a contract. Therefore the terms and
     conditions of the contract dictate what is covered by the insurer.
 11. The patient however has rights to pursue the insurer through the Third Parties (Rights
     Against Insurers) Act 1930 if the insured has or is about to become bankrupt.
Commercial basis
 12. All insurance companies in the UK are commercial enterprises and are regulated by
     the Financial Services Authority (FSA) which provides standards for insurers and can
     take action against insurance companies that do not meet those standards.
Claims-based cover
 13. Insurance companies in the UK offer claims-based cover to dental professionals. This
     means that a registrant is covered for claims if they are a policy holder of the insurance
     company when the claim is made.
 14. Insurance companies now offer run-off cover to their policy holders (usually for up to 10
     years), to cover them when they retire for claims that might arise in the future.
Background on discretionary indemnity
 15. Discretionary professional indemnity has existed in the medical field in the UK for more
     than 100 years. Its main characteristics are that:
          it is essentially discretionary;
          the organisations are mutuals that are not for profit and that abide by
           Memorandum and Articles of Association; and
          it is occurrence – based.




                            General Dental Council 37 Wimpole Street London W1G 8DQ
 Tel: 020 7887 3800 Fax: 020 7224 3294 Minicom: 18001 020 7887 3800 (via TypeTalk) Email: information@gdc-uk.org
Discretionary basis
 16. Discretion is the key difference between discretionary indemnity and insurance.
     Directors are given discretion to decide when to provide assistance and indemnity
     cover to members. It is not an automatic right for a member to receive assistance and
     assistance can be declined. The Board of Directors must follow the Memorandum and
     Articles of Association in determining whether to assist a member or not.
Not for profit basis
 17. Mutuals are owned by their members and are run by a Board of Directors under the
     Companies Act 1985. The purpose of the organisation is to protect the interests of
     members, and thereby the reputation of the profession it protects.
Occurrence-based cover
 18. Occurrence-based cover relates to whether the dentist was a member at the time the
     incident occurred/treatment has taken place, not when the claim is notified to the
     dentist/indemnity organisation. There is no pre-set limit set on how much assistance
     can be provided as the Board of the organisation determines the amount of cover
     provided.
 19. This means for example, that if a dentist carries out treatment on a patient in 2005 and
     is a member of a discretionary indemnity organisation, and three years later, in 2008,
     that patient makes a claim in relation to the 2004 treatment, the dentist is entitled to
     ask for indemnity assistance.
Background on NHS indemnity
 20. NHS indemnity consists of a risk pooling scheme providing indemnity cover for NHS
     bodies. In England this is managed by the Clinical Negligence Scheme for Trusts
     (CNST), the welsh scheme is the Welsh Risk Pool, the Northern Ireland Office runs a
     risk pooling scheme and in Scotland this is dealt with by the Clinical Negligence and
     Other Risks Scheme (CNORIS).
 21. NHS bodies are legally liable for the negligent acts and omissions of their employees.
     This applies where the negligent health care professional was:
          Working under a contract of employment (as opposed to a contract for services)
           and the negligence occurred in the course of that employment; or
          Not working under a contract of employment but was contracted to an NHS body
           to provide services to persons to whom that NHS body owed a duty of care; or
          Neither of the above but otherwise owed a duty of care to the persons injured.
 22. The amount of cover provided is not limited to a certain amount, and is not dependent
     on how large the claim is.
 23. NHS indemnity does not cover:
          Harm resulting from drugs or equipment which were faulty, unless there was a
           question whether the healthcare professional knew or could reasonably be
           expected to know about the fault but continued to use the drug or equipment;
          Patient harm caused when no-one acted negligently – although in exceptional
           circumstances the NHS body could make an ex-gratia payment.
          ‘Good Samaritan’ acts.
 24. Nor does the NHS indemnity cover defence costs of staff involved in disciplinary
     proceedings with statutory bodies such as the GDC. Practitioners are responsible for
     taking out their own cover against this eventuality.




                            General Dental Council 37 Wimpole Street London W1G 8DQ
 Tel: 020 7887 3800 Fax: 020 7224 3294 Minicom: 18001 020 7887 3800 (via TypeTalk) Email: information@gdc-uk.org
Professional indemnity: insurance

List A: Proposed minimum essential requirements for an insurance policy to be
‘adequate and appropriate’

The following list is proposed as the minimum essential requirements for an insurance-only
policy held by a registrant.




1.    The insurance cover must be for a registrant’s professional practice which includes
      clinical practice and Good Samaritan acts, with only standard exclusions. The
      insurance must cover newly recognised areas of dentistry.

2.    The policy must include run-off cover which must be obtained at the same time as the
      original insurance policy. The length of run-off cover must be a minimum of 10 years.

3.    The minimum sum insured is £10 million for any one claim and a total of £10 million per
      year. This will require review every 5 years.

4.    The settlement of claims with patients by the insurance provider must not be
      dependent on an excess or a deductible payable by registrants to the insurance
      provider, although the insurance provider may have rights to claim the excess against
      each insured.

5.    The insurance provider must a) have the authority to and b) agree to manage claims
      made by patients direct even if the registrant fails to co-operate or cannot be
      contacted, in situations where the patient is due compensation.

6.    The insurance provider must a) have the written authority to and b) agree to share
      information with the GDC concerning the cover held by registrants. This would include
      dates of cover, categories of practice covered and any special conditions imposed.

7.    The insurance policy must include vicarious cover for work carried out by
      non-registrants for whom the registrant is vicariously liable.




                            General Dental Council 37 Wimpole Street London W1G 8DQ
 Tel: 020 7887 3800 Fax: 020 7224 3294 Minicom: 18001 020 7887 3800 (via TypeTalk) Email: information@gdc-uk.org
Professional indemnity: discretionary indemnity

List B: Proposed minimum essential requirements for discretionary cover to be
‘adequate and appropriate’


Discretionary cover is a well established model in dentistry and in medicine. The following
list is proposed as the minimum essential requirements for a provider which intends to offer
discretionary indemnity cover.




1.    The discretionary indemnity cover must be for a registrant’s professional practice which
      includes clinical practice and Good Samaritan acts.

2.    The indemnity provider must be a mutual not for profit organisation, owned by the
      members; be able to confirm its financial resources and have independent actuarial
      sign-off; have a published Memorandum and Articles of Association, be managed by a
      Board of Directors who are accountable under the Companies Act 1985 and have
      advisory and support staff appropriately and adequately trained in the necessary legal,
      advisory, disciplinary and regulatory matters.

3.    The indemnity provider must a) have the authority to and b) agree to manage claims
      made by patients direct even if the registrant fails to co-operate or cannot be
      contacted, in situations where the patient is due compensation.

4.    The indemnity provider must a) have the written authority to and b) agree to share
      information with the GDC concerning the cover held by registrants. This would include
      dates of cover, categories of practice covered and any special conditions imposed.

5.    The indemnity cover must include vicarious cover for work carried out by non-
      registrants for whom the registrant is vicariously liable.

6.    The indemnity provider must provide to the GDC an exception report where indemnity
      is not provided to a member of the organisation




                            General Dental Council 37 Wimpole Street London W1G 8DQ
 Tel: 020 7887 3800 Fax: 020 7224 3294 Minicom: 18001 020 7887 3800 (via TypeTalk) Email: information@gdc-uk.org

				
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