Professional Indemnity Insurance – make sure you are covered

What is Professional Indemnity Insurance?

There are two categories of professional indemnity insurance (‘PII’) that cover you as a nurse or midwife when you are practising:

• firstly, under your employer’s PII arrangement (known as third party PII arrangements) and
• secondly, under your own PII arrangements (e.g. individual PII coverage as an ANMF member).

PII arrangements insure you for civil claims made against you for negligent acts, errors or omissions in your conduct as a health practitioner.

NMBA Professional Indemnity Insurance requirements

As an enrolled nurse, registered nurse or midwife, your practice is regulated by the Nursing and Midwifery Board under the Health Practitioner Regulation National Law (“National Law”).

Section 129 of the National Law provides that a health practitioner must not practise their profession “unless appropriate professional indemnity insurance arrangements are in force in relation to the practitioner’s practice of the profession.”

Each year at registration renewal time, you must make a declaration that you have practised the profession in accordance with the requirements of the NMBA’s Registration standard: Professional indemnity insurance arrangements (‘PII Standard’).

The PII Standard mandates that you must have PII ‘for all aspects of your practice’. You should be mindful that ‘practice’ is a much broader term than ‘employment’.  In Nursing & Midwifery Board of Australia v Morley [2014] SAHPT 17 the Health Practitioners Tribunal of South Australia held:

[the] ‘practice of nursing and midwifery’ means any role, whether remunerated or not, in which the individual uses their skills and knowledge as a nurse or midwife. (My emphasis.)

This broad definition of ‘practice’ has been followed by the NMBA and other state tribunals. It means that you need to be very careful when considering whether your employer’s insurers alone can provide you with the cover you must have to meet your professional obligations.  The NMBA PII Standard cautions that if ‘you intend to practise outside your stated employment, you must have individual PII arrangements in place to cover that practice’.

Practice outside your stated employment

Practising the profession occurs any time you use your skills and knowledge as a nurse or midwife.  Typically, this occurs while you are at work in paid employment, but it also may occur when undertaking:

• practical components of continuing professional development
• study involving patient treatment
• volunteer work
• attending at an emergency in a ‘Good Samaritan’ type capacity
• secondments.

These are examples of when you may find yourself practising the profession outside the coverage of your employer’s PII arrangements.

Inadequate third party PII arrangements

It is your responsibility to make sure your personal PII arrangements or third party PII arrangements through your employer provide you with adequate cover.

The NMBA PII Standard requires you, as a practising nurse or midwife, to have PII that includes:

• civil liability cover
• appropriate retroactive cover for otherwise uncovered matters arising from prior practice, and
• automatic reinstatement.

Complying with this aspect of the PII Standard may be particularly problematic when you rely solely on your employer’s PII.

Questions you should ask yourself when declaring that you have adequate PII under your employer’s arrangements are:

• Does my employer have a certificate of currency that demonstrates adequate PII coverage of my practice as a nurse or midwife?
• Has my employer maintained its premiums on its PII policies?
• Does my employer’s PII policy cover the scope of my practice as a nurse or midwife?
• Does my employer’s PII policy cover my practice at all?

Conclusion

As a nurse or midwife, you must not practise your profession without appropriate PII arrangements in place.  The PII arrangements must, at a minimum, meet the criteria set out in the NMBA PII Standard. While you will not be asked routinely by AHPRA or the NMBA to provide evidence of your PII arrangements, you must declare that you have adequate arrangements in place at registration renewal time. You may be required to provide evidence of your PII arrangements as part of an AHPRA audit. To ensure that you are meeting your obligations, you should consider availing yourself of PII coverage in addition to any third-party coverage that may be in place under your employer’s PII policy.