What is medical indemnity?
The Clinical Negligence Scheme for Trusts (CNST) provides indemnity to NHS bodies for clinical negligence
claims. The NHS Litigation Authority administer this process. Doctors working for NHS bodies or organisations
providing services to NHS patients are indemnified for their NHS work through their employing organisation.
There are equivalent organisations in Scotland, Northern Ireland and Wales.
However, GP contractors, locum GPs and salaried GPs employed by practices are not indemnified by the NHS
scheme and therefore require personal medical indemnity. Similarly, doctors undertaking private work or
work in independent hospitals are responsible for arranging their own indemnity with a medical defence
body of their choice.
Since 16 July 2014 and the introduction of the Health Care and Associated Professions (Indemnity
Arrangements) Order 2014, all registered healthcare professionals are legally required to have adequate and
appropriate insurance or indemnity to cover the different aspects of their practice in the UK.
The GMC's website gives details of the legal requirement for indemnity.
Who are the medical indemnity organisations?
Medical Defence Organisations (MDOs) are mutual non-profit making organisations, owned by their members.
The primary function of MDOs is to indemnify doctors for incidents arising from their clinical care of patients
and to provide members with 24-hour access to advice and assistance on medico-legal issues arising from
There are three MDOs: Medical Defence Union (MDU), Medical Protection Society (MPS) and Medical and
Dental Defence Union of Scotland (MDDUS). As the benefits of membership of the MDOs differ, it is
important that you consider each one carefully before making a choice.
What is mutuality?
The three MDOs are what are known as mutual organisations. This essentially means they are owned by their
members and that all the income generated by subscriptions is held in the mutual fund to defend members
and provide other benefits. Mutual organisations exist solely for the benefit of their members and no
dividends are paid to shareholders.
At the heart of the principle of mutuality is the fact that all the members of an organisation should contribute
to the common fund that is held on behalf of all members. This is an important principle and the annual
subscription amount is calculated based on the amount and type of work the member undertakes.
Alternatives to the MDOs
There are some other options for GPs unable or unwilling to obtain medical indemnity through one of the
MDOs. However, there are few providers in the private insurance market and premiums may be similar or
higher than the subscriptions charged by the MDOs. The level of cover may also not be sufficient to allow an
individual to remain on the medical performers list.
As a general policy, NHS England expects all GPs on the England National Performers List who are insured to
have minimum personal liability cover of £10 million for 2016, but this will need to be reviewed annually;
some MDOs question whether this is sufficient, as claims have been settled for more than £10 million. This
level is set taking into account the expected increase in payments for medical negligence cases in England. If
purchasing private insurance, all GPs are strongly urged to check that the personal liability cover is sufficient
before committing to payment. You should check with NHS England and your LMC if in doubt.
Why is the cost of medical indemnity increasing?
The cost of medical indemnity for GPs has risen significantly in recent years. GPC has received anecdotal
reports of rising indemnity costs that risks making some work, especially unscheduled GP care, prohibitively
expensive for GPs. The potential consequences of this could make the provision of unscheduled GP services
Higher indemnity subscriptions are the direct result of the rise in the number of cases and in particular the
number of high cost cases brought against GPs. For example, the MDU has experienced a rise in claims
frequency and size in recent years that has resulted in claims inflation rising at a steady rate of 10% per
annum. Medical negligence claims inflation has outstripped most other forms of inflation, such as house,
wage or retail price inflation. It is not unusual for an MDO to pay a claim for more than £5m on behalf of
a GP member.
However, the size of the award is no indicator of the seriousness of the negligence. Damages awards are
calculated on the basis they should as far as possible put patients back in the position they would have been
before the episode took place. In some cases this will include the provision of life-long future health and
social care for young patients and in others will reflect a significant loss of future earnings potential in
previously high-earning patients. Furthermore, the cost of the care a patient may require as a result of
negligence is based upon the cost of private care provision, not provision offered by the NHS.
It is also important to note this is not an indication of a deterioration in clinical standards. There is no
evidence this is the case and the MDOs themselves repudiate it by reference to the GMC's fitness to practice
In fact, the MDOs point toward the ease in which cases can be brought against GPs and how the processes
and procedures positively encourage patients to do so when they have a complaint. An analysis of MDO
claims shows that GPs are now more likely to be sued and full time GPs are now twice more likely to receive a claim than they were seven years ago.
The fact that more cases are being brought does not necessarily mean more GPs are being found culpable;
the MDOs also report a rise in the numbers successfully repudiated. While GPs bear no responsibility for
recent increases in claims numbers, through their annual subscription to the MDOs, members have to bear
the cost of MDO activity in investigating and responding robustly to these claims, as they have to bear the
cost of any compensation paid on their behalf.
Factors that affect indemnity subscriptions
The subscription rate paid by GPs varies depending on the amount and type of work undertaken. To get an
accurate quote of the rate applicable you will need to contact your MDO, but as a general rule subscription
rates are usually based on the number of sessions worked in total per week treating NHS patients.
A higher GP subscription rate may apply if you:
- undertake unscheduled GP care sessions (however if you provide these services to your own patient
population subscriptions should not increase as much)
- undertake private GP sessions or treat non-NHS patients
- undertake Forensic or Police Physician (FME) work
- work in a private travel clinic or a private walk-in centre
- work across multiple sites within a GP network or federation
- undertake occupational health physician work
- perform cosmetic surgery procedures
- employ pharmacists, nurses, and other clinical staff
- sports medicine
GPs are strongly urged to contact their MDO and discuss all of their various roles and responsibilities, not just
their day to day GP surgery role. If the MDOs have all the necessary information about the individual
member's clinical activities, they can offer the most competitive package. They should also inform their MDO
if their scope of practice changes. Practices also need to take indemnity issues into account when tendering
We all know that many areas are seeing trusts/health boards/vanguards/practices engaging allied healthcare professionals who often work in practices, or are shared across a number of practices, without necessarily being directly employed by them. This has raised concerns about the potential vicarious liability of a practice should they ask/direct a non-employed healthcare professional to undertake a specific clinical task and a claim later arose from that work.
The legal position in such an instance is not always clear and the claim could potentially be pursued against the individual, the practice where they are working at the time of the incident and/or their employing body. In terms of an individual having two indemnifiers (e.g. cover from one organisation and additional cover from another without clear delineation of what the additional cover is providing), it may be difficult to establish which provider is indemnifying the work in question.
That is why it is so important to confirm that the allied healthcare professional has a source of indemnity in place that would extend to any problems arising from the planned work before engaging them. Simply presuming that one of the practices’ group schemes will pick up problems arising from a shared member of staff may be naive.
We would recommend that practices hosting shared staff employed elsewhere take steps to assure themselves that appropriate indemnity arrangements are in place to meet claims arising from their work. This includes, but is not necessarily limited to:
- requesting sight of documentation confirming that the individual holds current indemnity that extends to work undertaken in general practice/primary care at the planned location
- ensuring that there are no limitations or exclusions relating to the planned work or location
- retaining a copy of this documentation at the practice and asking for an updated confirmation once out of date
- where the position is unclear, agreeing with the individual that they will confirm with the employing body or indemnity provider (in writing) that the individual holds indemnity that extends to the planned work and that the practice partners will not therefore be liable in the event of a claim arising from the acts or omissions of the individual shared staff member; a copy of this response should be kept by the practice
- where an individual is indemnified through a group scheme held by another practice, confirming (in writing) with the group indemnity provider that the indemnity extends to work undertaken outside the specific practice
- where an individual does not hold (or is unable to demonstrate that they hold) individual indemnity for the planned work then the hosting practice should speak to their own indemnity provider to explore indemnity options for the work planned for the individual at the practice
- confirming that the individual is appropriately trained, experienced and qualified to undertake any planned work (this may include reviewing their job description)
- ensuring that appropriate supervision and clinical support are in place and that the individual is made aware of and complies with any relevant policies and protocols which the practice adopts (particularly when the individual is new to the practice).
Possible solutions to the increasing costs of indemnity
Evidence from other jurisdictions suggests that legal reforms are the most effective way of reducing the cost
of medical indemnity. The MDOs believe that reform of the law of tort is the only workable solution for
England (where compensation awards in medical negligence claims are significantly higher than in the rest of
the United Kingdom). One suggestion is that the law should be changed so that MDOs and the NHS Litigation
Authority, which can be required to pay compensation on the basis that care will be provided in the
independent sector, could purchase NHS and local authority care packages for victims of medical negligence
as a way of keeping compensation monies within the NHS.
The idea of 'NHS indemnity' has also been suggested, which is provided by the Clinical Negligence Scheme for
Trusts and administered by the NHS Litigation Authority. The current difficulty with this model is that the NHS
Litigation Authority has suggested that it cannot afford (and does not have the experience or expertise) to
indemnify individual GP practices as currently structured. They argue that Hospital trusts, being larger
organisations, can conform to much tighter corporate policies, protocols and guidelines around avoiding
clinical negligence, potential litigation and handling patient feedback and experiences. The potential for
variation across multiple smaller organisation such as GP practices is perceived by the NHS LA to present too
great a risk. The introduction of large primary and community care organisations, such as GP networks or federations, vanguard sites, multi-specialty community providers etc., may provide opportunities for the
Litigation Authority to consider providing similar indemnity to that currently enjoyed by trusts, although this
is not a short term solution and is unlikely to be a primary reason to form such groups.
There could also be drawbacks to the above model. MDOs are constituted in such a way as to support GP
members as individuals, with attention to their personal interests, whereas the NHS LA would have to
manage claims on behalf of Trust members and liaise with the Trust management, rather than the individual
doctors. Such a system would not reduce the amount or the cost of claims either, so they would still have to
be paid for. Transferring the risk will not diminish it.
Will calling my MDO for general advice identify me as presenting a greater risk?
No, the MDOs are clear that calls for general advice will not result in increased subscriptions in themselves.
MDOs positively encourage their members to get in touch when something has gone wrong so they can
provide timely medico-legal advice and assistance. GPC would like to hear from any members who believe
this is not the case.
What's the difference between occurrence-based cover and claims-made cover?
Occurrence-based indemnity means an individual will be indemnified for events that occur while they are a
member of an MDO, regardless of when an actual claim is made. Subject to the individual terms of the cover,
this will probably include a doctor moving abroad, ceasing clinical work or retiring and even after death.
Insurance products operate differently and usually only guarantee protection to an individual while they are
insured, both when the incident occurred and when the claim is made. This is important because medical
malpractice claims can be made several months or even years after the events that give rise to the claim.
Should other members of my practice team have their own indemnity cover?
Yes, unless your MDO specifically offers group indemnity including some or all members of the practice team.
What do the MDOs classify as unscheduled or out of hours care?
This will vary and members should contact their MDO for clarification. As an example, two of the MDOs
define Scheduled or Standard Care as work undertaken during the scheduled opening hours of the practice
(within 8am-8pm, seven days a week) where registered patients are seen by appointment and where staff
have access to the patient's full general practice records. They also include patients from other practices
where there are arrangements to provide care during scheduled opening hours and there is access to full
The two MDOs also define Unscheduled Care or 'out of hours' sessions as any work that falls outside the
above Scheduled Care criteria, such as sessions undertaken at any time of day in walk-in or urgent care centres.
Unscheduled care is exposed to materially higher risks that can result in larger clinical negligence claims.
Factors that affect risk include not knowing the patients as you do in your own practice, not having access to
their patient records, dealing with patients that may have urgent or emergency conditions and require swift
diagnosis or treatment etc.
What happens if I want to change my MDO?
Members may from time to time wish to look at the terms and conditions provided by other MDOs in case
these are more favourable. However, if you do decide to change provider, ensure you have access to
indemnity in case of a claim during the transition period and that you remain able to seek assistance with
claims that arise from incidents that took place when you were with the previous provider but that are
reported while you are with the new provider. This is particularly important if you seek cover from the private
insurance market. Also check carefully your benefits of membership or policy and that there are no gaps that
might leave you vulnerable as an individual or a practice. This is especially important given the legal
requirement to have adequate and appropriate indemnity for your practice.
Never cancel your indemnity arrangement with your existing indemnity provider until your new provider has
confirmed that they have accepted you as a member of their mutual organisation or will cover you, and the
date from which your membership or cover will commence.
Is the situation different in Wales?
Welsh Risk Pool Services is a mutual organisation which reimburses losses over £25,000 incurred by Welsh
NHS bodies arising out of negligence. The Welsh Risk Pool Services is funded through the NHS Wales
Healthcare budget and provides indemnity to GPs in Wales for their out of hours work only. It should be
noted that if GPs are directly employed through a contract with the health board then NHS indemnity also
applies to them. The indemnity relates only to clinical negligence claims arising from OOH work and GPs need
to make their own arrangements with the MDOs for indemnity for all other work and for advice and
assistance with matters such as complaints, GMC investigations, inquests and criminal investigations.
What help is NHS England able to offer to tackle rising cost of GP indemnity?
A new GP Indemnity short term financial support scheme will provide a special payment to practices, linked to unweighted patient population, to offset average indemnity inflation. The Scheme will initially run for two years, when it will be reviewed.
The first special payment to practices, linked to unweighted patient population figures, to offset average indemnity inflation is being made from mid-March 2017. A sum of £30 million (agreed as part of the 2017/18 contract negotiations) will be distributed to practices (calculated at 51.6 pence for each registered patient on practices lists as at 1 December 2016). Read more about how this funding should be distributed within the GP contract 2017 section.
NHS England has also repeated its Winter Indemnity Scheme to help GPs cope with extra demand over the winter period by reimbursing the indemnity costs for out-of-hours sessions. The Winter indemnity scheme was originally developed with the MDOs to offset the additional indemnity premium for GPs who wish to work additional sessions for their out-of-hours (OOH) providers. The current scheme was due to run between October 2016 and March 2016 allowing GPs to commit to more OOH sessions without the need for them to negotiate additional changes to their level of indemnity cover. However, this has been extended to run until Sunday 30 April 2017. Guidance on how to access the scheme and scheme FAQs are available on the NHS England website.