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Letters to the Editor
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PI insurance
NPA always comes down on the side of its members
From Mr G. Southall-Edwards, MRPharmS, Barrister-at-law
I wrote to The Journal recently (PJ, 15 May, p606) in an effort to clarify
the difference between the two common bases of personal indemnity insurance
and also to state my legal reasoning as to why I believe both employees
and self-employed locums should insure themselves against claims for
negligence.
On the same page as my own letter, was a contribution from the NPA’s
chief executive John D’Arcy, which confused the issue; I say this
because I have since received many requests from pharmacists to explain
matters more fully, clearly indicating a misunderstanding of the PPI
policies he referred to.
Mr D’Arcy refers to the NPA’s “claims occurring” insurance
(what I described as “incident-based”) and, apart from seeking
to extol the virtues of Chemists’ Defence Association insurance
provided to members by NPA membership (not available to locums and employees),
Mr D’Arcy states that his organisation offers, through its subsidiary
Pharmacists Professional Indemnity Limited Ltd, PI policies for individual
employees and others, eg, locums, who are engaged in community pharmacy.
He does not actually say that these are also “claims occurring”,
but the clear impression given to readers by the omission to state the
basis, is that they are, as I know from those who have contacted me with
questions since reading his letter. In fact, they are not — they
are claims-based, just like those offered by his competitors, the Pharmacy
Insurance Agency/Pharmacists’ Defence Association, which he and
Brian Threlfall (PJ, 3 April, p413) have criticised both directly and
by implication.
This failure to clearly state the basis of PPI policies is regrettable
and I would wish to ensure that readers are aware of the true facts,
which are that both the PPI Ltd and the PIA/PDA Ltd offer policies on
a “claims made” basis, where the policy must be in force
when a claim is made, not just when the error or omission occurs.
Finally, I note that Mr D’Arcy seems to have anticipated the printing
of my letter when he wrote his, since he was at pains to give assurances
that “we have never, nor will we ever, seek to reclaim any costs
from an individual pharmacist or member of pharmacy staff”. This
seems to be a clear response to my legal point about the rights of employers
and their insurers to sue employees and locums alike. In response thereto,
I would simply make the further point that his statement is what lawyers
term an “agratuitous” promise, unsupported by consideration
and that the NPA is free to change its mind about this at any time it
pleases. As an experienced pharmacist and tort/contract lawyer who has
handled many claims against pharmacists and most of those passed from
the NPA to the PDA, I can state with confidence that when it comes to
the crunch, the NPA always comes down on the side of its member; how,
therefore, can this employer’s organisation claim to be able to
offer to protect the interests of individuals insured by the NPA’s
wholly owned subsidiary PPI Ltd?
G. Southall-Edwards
Tirol, Austria
Confusion over NPA PI insurance
From Mr M. Koziol, MRPharmS
In seeking to clarify the National Pharmaceutical Association position
on professional indemnity insurance, it would appear that John
D’Arcy,
has managed to confuse matters — his letter of 15 May (p606) is
highly misleading.
Judging by the calls that we have at the Pharmacists’ Defence Association
(PDA) he has wrongly given the impression to many individual pharmacists that
the NPA PI scheme for individual pharmacists is provided on a “claims
occurring” basis. This is not the case, the policy provided by the NPA
for individual pharmacists is provided on exactly the same basis as that of
the PDA policy, ie, on a “claims made” basis.
He then goes on to say that the NPA provides its individual pharmacist insurance
through a subsidiary called Pharmacists Professional Indemnity Limited (PPI).
I presume that PPI was set up to help deal with the conflict of interest that
the NPA has with providing protection to both NPA members and also to individual
pharmacists.
What he does not make clear is that PPI Limited has been operating as a dormant
company as is evidenced by the accounts that it has filed at Companies House.
This means that the true insurer of individual pharmacists is not PPI Limited
at all, but the parent company, the Chemists Defence Association, which is
owned by the NPA. This means that NPA members enjoy manifestly different treatment
from the NPA than do the individual pharmacists who take out their cover with
PPI.
This is only to be expected, because the constitution of the NPA says: “Where
a conflict arises [between an employer and an employee/locum] the Associations ‘allegiance’ must
lie primarily with the member — the owner of the business.”
It is abundantly clear that the interests of the individual pharmacist can
never be served by relying on the NPA — an employer organisation — for
their individual PI insurance.
Mark Koziol
Director
Pharmacists’ Defence Association
www.the-pda.org
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JOHN D’ARCY, chief executive, National
Pharmaceutical Association,
replies:
The principal purpose of my letter was to highlight to NPA members — many
of whom have been contacting the NPA to clarify the position — that
the indemnity and defence benefits provided by the NPA are written on
a “claims occurring” basis. This is a reflection of the added
value of the cover offered by the NPA to members and is becoming increasingly
unusual in today’s insurance market. It was never our intention
to confuse or mislead anybody. As your correspondents point out, the benefits
offered by PPI are offered on a “claims made” basis. |
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The
Pharmaceutical Journal