Medical practice: Trainee insurance

Legal indemnity is insurance against lawsuits. In the event of a claim, legal costs and fines are met by the insurance company. For a higher premium, cover can include any damages awarded against the insured. Interns and residents are supposed to be supervised. Because of this, they are generally not liable for oversights, mistakes, or mistreatments.



Medical practice within the public hospital system is covered by the hospital’s own insurance policy. Unfortunately, this insurance is often very basic and has significant drawbacks or limitations. Also, whereas Medical defense organizations (MDOs) or private indemnity insurers can provide problem-specific legal advice 24/7, standard hospital cover does not provide any services of this kind. The following are generally not covered by a hospital's own insurance:



  1. Legal costs and representation for Coronial inquiries, Medical Board inquiries and disciplinary hearings.
  2. Good Samaritan acts in the community.
  3. Locum shifts at other hospitals or work outside of the employed position, eg. surgical assisting or work as a team doctor at a local sporting club.
  4. Volunteer work.


While rare, it is possible for the trainees to be individually prosecuted by a member of the public. This must have not taken place many a times in recent past. This pretty much never happens, and that's one of the reasons why the cost of professional medical indemnity for an intern or resident is very cheap -- as far as the policy issuer is concerned, the risk is virtually nil, which makes for very small premiums. Such kind of payments should also be allowed for tax deduction. This will be a kind of encouragement to those trainees. While such insurance might never be used, it will also guard against the worst case scenarios and provides the peace of mind, and a number of medical trainees take out other private policies. This encourages the trainees to opt for such insurances. Various private insurance companies offer a range of different policy covers, and calculate premiums on a case-by-case basis. Because of this, it is not possible to offer generalized advice on which to choose. It is possible, however, for an intern or resident to assess the cover provided by their employing hospital - by answering the following questions, a trainee can gain a clearer picture of whether to rely on the hospital policy, or whether to take out their own:



  1. Is the indemnity specified in the contract of employment ?
  2. Are there any aspects of training where this indemnity will not apply (eg. private patients in a public hospital) ?
  3. Is the hospital's indemnity contractual (i.e. must be provided) or discretionary (i.e. the hospital can assess the coverage they give after viewing the claim) ?
  4. What happens if the hospital's legal team finds against you, or you have a professional dispute with your employer ?


Taking out a medical indemnity policy is an act of risk minimization. In most cases, the negligible cost is easily worth both the cover and reassurance that a private policy can provide.