As APS members would be well aware by now, under changes introduced with the national registration scheme, all practising psychologists must have current and sufficient professional indemnity insurance cover which meets the standards specified by the Psychology Board of Australia. There are a couple of important policy areas that members should be aware of, which are of particular relevance to psychologists working in the public sector or moving between the private and the public sectors.
Extent of coverage
The APS has been informed by several psychologists employed in the public sector that their employer’s professional indemnity insurance policy covers the organisation for any complaints, but that this could specifically exclude complaints about any individual employee’s conduct that may be under consideration by the Psychology Board of Australia.
Although some of these policies may meet the existing Psychology Board professional indemnity insurance standards, members who work in the public sector are advised to seek clarification from their human resources department on whether the organisation’s professional indemnity insurance policy provides cover for individual psychologists for costs incurred defending complaints made against them. Those members who find they are not covered by their employer’s insurance policy may consider purchasing additional individual cover. The APS recommended broker for professional indemnity insurance, Aon Risk Services, provides cover at a significantly reduced premium for those psychologists who are employees, volunteers, academics or work in an administrative role. Please note that this type of policy is not an option for any psychologist earning any part-time private income. For more information visit: www.aon.com.au.
Type of cover
Most professional indemnity insurance policies use a ‘claims made and notified’ approach, which means that a psychologist is covered as long as he or she had insurance at the time of becoming aware of a complaint. That is, the actual incident does not need to occur in the year during which insurance is held. The alternative type of policy is an ‘occurrence’ approach, which means insurance needs to have been held at the time the incident occurred. In this instance the policy would only cover the insured psychologist for actions that occur during the policy period.
The key proviso in the ‘claims made and notified’ approach tends to be the inclusion of a retroactive date; that is, how far in the past an incident can occur that the psychologist will be covered for. The APS endorsed insurance provider, Aon Risk Services, has ensured the endorsed policy has an unlimited retroactive date. This means that the Aon policy will provide cover if the incident occurred at any time in the past as long as the psychologist has an up-to-date policy and has advised Aon of any matter that may give rise to a claim.
Psychologists who move jobs within the public sector or from the private to the public sector are encouraged to check their professional indemnity insurance policy wording carefully to see what type of cover it offers – ‘claims made and notified’ or ‘occurrence’. This applies especially to those moving from independent private practice to the public sector. If the policy is claims made and notified, check the exact retroactive date to see how far back the cover is provided. The most important thing to consider when changing employment or returning to private practice is that you maintain cover to ensure all past and current activities are insured against.
A little time spent now reviewing the policy wording of your professional indemnity insurance policy could save some heartache in the future. For these type of situations, ‘Prevention is definitely better than cure’!
Mick Symons MAPS
Manager, Member Services
REVIEW OF APS RECOMMENDED PROFESSIONAL INDEMNITY INSURANCE FACILITY
For more than 20 years the APS has offered members a recommended professional indemnity insurance product through an insurance broker, which enables members to have access to a high quality policy at very competitive premiums. On an ongoing basis the APS has reviewed and improved the professional indemnity insurance facility on offer to members to ensure it continues to meet the needs of practising psychologists. This regular review allows members to be confident that the professional indemnity insurance product provides sufficient coverage and meets the stipulated requirements of the Psychology Board of Australia. Part of this review process has been to periodically put the brokering of the APS recommended professional indemnity insurance product to tender to selected companies.
The APS has just commenced a new round of the selected tender process which will involve approaching relevant insurance brokers that are in a position to provide a quality professional indemnity insurance product that meets psychologists’ requirements. These companies will have the opportunity to show how they would be able to best meet the professional indemnity insurance needs of practising psychologists. The tender process should be completed by late April 2012, which will be in time for the next financial year of 2012-13 when many members renew their APS recommended professional indemnity insurance.