What to consider when insuring your pharmacy

This article was first published by Cambrian Alliance.

Pharmacists' Professional Indemnity insurance choices have been limited historically, and pharmacy owners are juggling a complicated business. But, whilst the demands have increased and the services provided by pharmacies have transformed in recent years, the options on the table for insurance to meet the evolving needs of the pharmacy sector have remained the same.

In this article we review the needs of pharmacy owners to provide a simple guide to what you should be thinking about - to ensure that you find insurance that is fit for your future.

Look at your options

Historically, pharmacists have had limited choices when it comes to insurance. Many community pharmacists have taken up memberships with groups just in order to ensure that they can access the insurance they need.

At a time when business owners are worried about rises in National Insurance contributions and declining reimbursement, looking at options when reviewing the choice available to you makes sense.

Choose a provider with pharmacy expertise

More than most businesses, finding adequate insurance requires brokers with niche knowledge of pharmacy as a sector. You need to be able to know, quickly, that who you're chatting to knows the risks, whether from dispensing, services, staff, or day to day issues, and is then building cover bespoke to you. 

Whilst there are more choices from insurers than there once were, the specificity of how pharmacy businesses operate, means that working with a business that has industry know-how makes sense. With over 10 years’ experience in the sector, Howden knows the importance of working with pharmacies to ensure their cover is "fit for purpose".

Look for a broker with a broad commercial offering

Ten or fifteen years ago, simple cover for professional indemnity and other day to day aspects of a pharmacy may have worked for the majority of owners. But with the pressure to deliver services - to provide accessible care for the community and identify more ways of generating revenue, it means that there's a multitude of new potential risks.

It is worth your time when planning expansion to services, staffing, or even buying new robots, to talk to your broker about the insurance implications, and ensure you have cover that suits you.  Common things pharmacy owners are concerned about are vaccinations, independent prescribing and patient gropy directions. However, business owners should consider  if they are covered if they use a third party like a locum or, increasing a remote prescribing service.

It's key to work with someone who you can ask these questions, but who offers a wide commercial offering that has the answers when you do need cover.

Avoid being underinsured

With many pharmacy owners updating infrastructure like shop refitting, purchasing expensive dispensing robots, adding different technical equipment, new services to cover and with stock value changing rapidly - underinsurance is a risk for many busy pharmacists.

Underinsurance means that the amount of cover you have arranged doesn’t reflect the reality of what you actually have.

For example, you are covered for £20,000 of stock, but in reality you have £40,000 of stock at the time when you need to make a claim. Because you are effectively 50% underinsured, your insurer may only pay 50% of the claim. So, a claim for £10,000 of damaged stock could see an insurance payment of only £5,000, leaving you hugely out of pocket.

Whilst you might think you are covered by existing insurance, when adding new services and working with third parties can mean varieties of risks that it's worth finding out about.

Working with an experienced broker can help ensure you are covered comprehensively under one policy that can adapt to the changing needs of your business - whether for fleet insurance, buildings and contents, locums and more.

How Howden can help

Our insurance solutions are designed with flexibility in mind, our products can be purchased as one combined policy with a single renewal date or separately depending on your needs. Unlike some other providers, we’re free of compulsory membership, meaning that there is no additional cost to accessing our products.

As specialist insurance brokers to the health and care sector, we are dedicated to sourcing solutions for pharmacies and pharmacists, designed to protect you and your business from every angle. Speak to our team to see how we can help your business.