Under the unprecedented circumstances brought about by the outbreak of the COVID-19 virus, and the preventative measures that have been put in place as a result, we fully sympathise and understand that you may be considering cancelling your insurance policy due to needing to carefully manage your expenses.
However, we have a responsibility to inform you of any impact caused by this action. This cover is complex and under certain circumstances, cancelling your cover midterm or allowing your policy to expire at renewal could have a detrimental impact on your protection provided to you by the policy. In doing so, you could be left significantly at risk for any of your past work carried out over the years.
If you have a care worker professional liability insurance policy that is written on a 'claims-made' basis, it will defend you and deal with any claim, regardless of when the incident occurred, as long as you have a valid policy in place when the claim is made.
Therefore, if you were to cancel your policy in order to reduce your expenses while you are not working, if a claim was made against you for an incident that occurred previously, then even if you held the insurance at the time of the incident, you would not be covered because you do not hold it at the time of the claim.
Simply put, if you cancel your insurance due to the current COVID-19 pandemic and a claim is made against you, and you receive this claim before a new policy is arranged in the future, you are not insured.
A claims-made policy will pay out for any valid claim made during the policy period, regardless of when the incident or alleged breach of duty occurred, as long as your policy is in place when you receive the claim. Therefore, to ensure you are covered, ensure your policy is continuous and there is no break in your insurance.
If you cancel your policy, you will not be able to submit a claim for any incident or circumstance which you are notified whilst you do not hold a valid policy.
If you cancelled your insurance on 1 January, then set up a new policy from 1 June, but in the meantime received notification of a potential claim on 1 March, this would not be covered.
However, if you did not cancel your policy, then subject to the standard terms and conditions, you would be covered against that claim received on 1 March.
If your care professional liability insurance cover is on a ‘claims occurring’ basis, whereby once cover is purchased for a period, you are insured for any event during this time that leads to a claim. This the case even if the claim is brought once the policy has finished.
However, even if you have such a policy, they are complex and therefore it is better to be sure you are not putting yourself at risk. We recommend strongly you speak to us before you cancel any care professional liability insurance policy, to ensure you are not left exposed.
If you have any questions, please see our care and medical professional liability insurance webpage contact the Towergate care team on 01438 73525 or firstname.lastname@example.org.
Carolyn Baker-Mellor is a respected industry leader with over 35 years' experience within the care insurance sector. She works across a wide spectrum of insurance product and policy development, delivery and optimisation for care industry clients, including managing global corporate accounts, working closely with trade associations, and helping clients in protecting their businesses and personal assets. Her areas of expertise within the sector include care homes, nurseries, domiciliary care, hospices and charities.
Carolyn currently works at Towergate as Head of Care Insurance. Towergate is the UK’s leading independent insurance broking platform and forms part of the Ardonagh Group, an international network of over 100 offices and 7,000 people which incorporates leading brands in both Lloyd’s of London and global markets.
She previously worked for 10 years at Aon as a director, client services leader and assistant director for claims.
The information contained in this bulletin is based on sources that we believe are reliable and should be understood as general risk management and insurance information only. It is not intended to be taken as advice with respect to any specific or individual situation and cannot be relied upon as such.
Date: December 24, 2019
Category: Care and Medical