Considerations when selecting professional indemnity insurance

Professional indemnity insurance cover is mandatory under the national registration scheme for all practising psychologists. This insurance is a complex area and there are several issues psychologists should consider when investigating professional indemnity insurance options.

• Differences in policy detail can have far-reaching consequences on the extent of cover, particularly when referring to the level of cover for Inquiry Costs (to cover complaints heard by the psychology registration board).
• The full policy wording should be requested in order to make meaningful comparisons. Do not rely on a flyer listing dot points – that is not a full policy wording.
• Complaints can often take a long time to settle, and major costs can still be incurred even if the psychologist is cleared of an alleged ethical breach.
• Some members have informed the APS that after they took out a policy with a non-endorsed insurance provider, they were not offered renewal terms because they had made a claim during the preceding year.
• Some members have found that generic medical insurance cover policies offered to psychologists make no reference to Inquiry Costs.

APS recommended broker for professional indemnity insurance

Aon Risk Services is the current APS recommended broker for professional indemnity insurance, as approved by the APS Board of Directors. The Board selected Aon based on its links with insurance underwriters with strong financial standing, its offer of a relevant and comprehensive insurance product, its demonstrated knowledge and experience of the psychology field, and its proven service delivery record. The Aon insurance offer for 2011-12 has strong key features indicative of good quality, as indicated by the following.

• Aon has selected CGU as the insurance underwriter which has an AA- rating (higher than A+) with Standard and Poor’s.
• The sub-limit for Inquiry Costs for the 2011-12 policy is $1,000,000.
• A free legal advice service is available on a toll free hotline, which provides up to 120 minutes consultation for any legal matter related to the insured person’s role as a psychologist.
• The insurance renewal process is streamlined, involving direct payment of the Aon tax invoice for immediate cover if there are no changes to the practitioner’s insurance arrangements.
• Risk management seminars for APS members are conducted by Aon staff through APS Branches across the country.

The comprehensive process undertaken by the Society when selecting the Aon facility should reassure APS members of the quality of the insurance product offered by Aon. The APS endorses the Aon insurance product to its members, which is available at competitive premiums. As part of the insurance arrangement, the APS does receive revenue through the Aon facility associated with the Society’s role in both working with Aon on an ongoing basis to ensure the insurance product offered is best able to meet the needs of members and liaising with Aon regarding insurance issues affecting those insured, including when they make a claim against the policy.

Salaried psychologists

With the introduction of mandatory professional indemnity insurance last year, many employed psychologists discovered that in the event of a complaint against them their employer’s policy covered the organisation but expressly excluded cover for them to defend a complaint in a registration board hearing. Salaried psychologists should check with their human resources department to find out the full extent of the type and level of cover. If there is any doubt, consider the Aon Category C cover which is offered at the lowest premium to cover employees, volunteers, academics or those working in an administrative role.

Run-off cover for retired psychologists

Those members with Aon insurance cover who have retired or are about to retire from practice as a psychologist should contact Aon in order to be included in run-off cover arrangements. This will ensure cover for any future claims about past practice as a psychologist. Please call Aon on 1800 805 191 or send an email to: [email protected].

Future professional indemnity insurance endorsement

The process for the regular review of the recommended broker for the APS professional indemnity insurance offer to members will commence in the near future. It will involve the establishment of an APS Insurance Committee panel to set the parameters and timelines in order to have a decision ready before the financial year 2012-13.