Choosing your limit of indemnity

What should my limit be?

To date, the largest malpractice award in Singapore is the S$5.3million judgment against two treating doctors in the Franklin Heng case. The largest out of court settlement in Singapore that we are aware of involved a similar amount. For this reason, the lowest limit of indemnity offered by Howden is S$5 million. Some doctors will prefer higher limits, and we offer up to S$15 million when required.

Why policy limits need to account for medical inflation

The delay between treatment and final settlement of a malpractice claim can be substantial. Which means claims for a mistake made today could mean a liability that ultimately demands a significantly inflated sum. 

When you apply for or renew your Howden Medical Indemnity Insurance policy you need to consider the question of an appropriate limit of indemnity.   

You should not only consider exposure to claims today, where the profile of your patients and your specialisation are important, but also future medical and economic inflation.  

According to PWC’s Behind the Numbers of Medical Inflation, there are several factors affecting 2018 trends: 

•    Rising general inflation
•    Fewer branded drugs coming off patent
•    Political and public scrutiny on drugs prices
•    People being targeted with the right treatments 

While general inflation has remained low in Singapore, Medical inflation rises much faster.

Estimates range from 2.4% per year to an alarming 18%. 

As healthcare spending rises, so do prices.

In Singapore, healthcare spending has increased dramatically over the last decade or so. Between 2011-2015 health care spending has risen by more than 60%, according to Senior Minister of State for Health Chee Hong Tat.   

Singapore healthcare costs rose 60% between 2005-2011

With a widely reported 15% rise in 2016 (compared to a global average 8.1%)*, we can expect the figures for the subsequent five year reporting period to be much higher. 

Simply put, the more private medical fees rise, the larger the sums you can potentially be sued for. Even calculating by a more modest average of 10%, consider the impact of the following three claim scenarios, each of which begins with an estimate of S$3 million:
 

Negligence claims value scenarios
 

Claims and time limits in Singapore.

While the time limit for bringing most malpractice claims in Singapore is three years, this applies from the first date that the injury manifests itself. 

For doctors treating newborns or children, the three year period only begins when the patient reaches seniority at twenty-one years of age. Even in cases where children are not involved there can be lengthy delays. For example, the recently reported six-month suspension of a GP practising aesthetic medicine relating to treatment provided in 2008-9.

For patients who suffer from mental incapacity, there is no time limit for bringing claims.

Don’t get caught out

When you apply for a Howden Medical Indemnity Insurance quotation, you can seek standard options of S$5 million, S$10 million or S$15 million.  Other limits may also be offered on request. 

Should you require any further assistance in choosing your limit of indemnity, please contact the Howden Healthcare team.