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Why less Indemnity cover is risky for Doctors?
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Why less Indemnity cover is risky for Doctors?
Why less Indemnity cover is risky for Doctors?

Negligence cases against medical professional are on the rise. Many instances of medical negligence have come into notice in recent years. It is believed to have a surge of 400%, from which certain cases have been solved by the Consumer Protection Act (CPA) since 1994. In this medical negligence cases, the compensation which is directed by the courts is usually in the denominations of lakhs and even Crores. At times, it is the relatives of the patient who file such cases. According to MrMahendrakumarBajpai, an advocate of the Supreme Court, “ cases of medical negligence have been doubled since the year 2014 as more and more people are challenging doctors expertise.” Further, a survey conducted in the year 2013, states that around 5.2 million medical-legal cases have been noticed.

The courts are becoming consumer-friendly, which means more and more cases, are disposed of in the favour of consumers. Therefore, it has become a sheer need to provide insurance coverage to the doctors.


Protection To Doctors


In the current situation, it has become necessary that doctors protect themselves against frivolous lawsuits. The tension and embarrassment that comes through such lawsuits is something which an individual can’t ignore. The only solution doctor has right now is to minimize the financial risk that comes along these lawsuits. Compensation that arises in such cases is extremely high, and therefore, through an Indemnity Insurance, the doctors can set aside the financial drawbacks through these lawsuits.


What is Indemnity Insurance?


Indemnity Insurance is a type of legal agreement where both parties agree to certain pre-defined terms and conditions. This is a contractual agreement which should be in written form and duly signed by both the parties. It is designed in such a way that safeguards the interest of the professionals against paying huge compensations. This kind of insurance not just covers the compensation amount, but it also covers up the legal remuneration such as the fees given to lawyers. More the amount of Indemnity Insurance, more are the chances of less risk in the future. In simple words, risk reduces as the amount of insurance increases. The type of Indemnity Insurance also depends upon the type of doctors. Mostly, Indemnity Insurance agreements are valid for 12 months. After every 12 months, a new agreement has to be formulated.

The threat of litigation is so high that certain corporate and private hospitals have made it compulsory for the doctors to avail Indemnity Insurance before they join as a consultant in the hospital.


Will Indemnity Insurance Benefit The Doctors?


Recently, a panel formed by the Government of India revealed that out of all the cases filed for medical negligence, only 15% of the cases were genuine. Despite this, the amount of compensation and the number of cases both are on the rise. Medical negligence cases have created a serious threat in the medical fraternity. As under such circumstances, mostly, the degree of power is in the hands of the patient.

Therefore, it is always advisable to be prepared for such circumstances. As it is said, “Precaution is always better than cure”.


Few Benefits Of Indemnity Insurance:


  • Insurance can be altered mid-term. The amount of insurance can be increased or decreased as per the doctor’s requirements.
  • Hassle-free documentation.
  • Indemnity Insurance covers a large area; from compensation to legal fees incurred. Insurance covers losses as well as risks.


Cases Where Huge Compensation Was Awarded


  1. KunalSahavs AMRI case

This complaint was filed by KunalSaha for his wife, AnuradhaSaha who died at the age of 36 due to the sheer negligence of doctors in Kolkata.

Itis one of the most significant case law pertaining to medical negligence in India.KunalSaha, a doctor by profession himself, filed a case against the doctors of AMRI hospital in Kolkata. However, after his petition was dismissed in Calcutta High Court and West Bengal Medical Council, he went to the Supreme Court of India. After a proper investigation, the Supreme Court directed the hospital and the doctors to pay a compensation of Rs. 5.94 crores along with interest, i.e. Rs11 crores. This is the maximum amount that has been awarded as compensation for medical negligence.


  1. Delhi based case

Recently, in Delhi, a hospital was directed by the apex Consumer Court to pay a compensation of Rs. 8 lakh to the widow of a private school teacher. The reason of this compensation was that the hospital without a proper health checkup discharged the patient which led to her death within a few days.


  1. AIMS case

A few years ago, the All India Institute of Medical Sciences was directed by the Supreme Court of India to pay a compensation of Rs. 5 Lakh to the patient after it was observed that a doctor wrongly diagnosed a woman with cancer and surgically removed the affected part.




As mentioned above, there are a lot more cases where medical negligence gets proved by the complainant, and then the doctors or the alleged hospital pay a huge amount of compensation. Due to this unreasonable increase of medical negligence cases, it has become very important that doctors start enrolling for Indemnity Insurance which will make sure that at least the financial losses are minimized. Further, it is advisable to take the help of a lawyer who is experienced to make such agreements and who can explain the legal consequences.

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