Insurance

Report claims early to professional indemnity insurers

By AdvocateDaily.com Staff

Pharmacists and other regulated professionals should err on the side of caution when reporting claims to their professional indemnity insurers, says Toronto insurance defence lawyer Heather Vaughan.

Vaughan, a partner with Benson Percival Brown LLP, recently told an audience at the Ontario Pharmacists Association’s annual conference that as soon as a potential claim arises, it should be reported to their insurer, acknowledging it’s likely to be a “scary and embarrassing” process.

“You pride yourself on your work, so this is a hard thing to do,” Vaughan says, who defends negligence claims based in professional liability under an Errors & Omissions (E&O) policy, as well as acting for professionals before regulatory colleges on complaints, discipline and fitness-to-practice hearings.

“But the consequences of not reporting a claim could be way worse — denial of coverage and/or defence costs,” she adds.

The emergence of a potential claim can come much sooner than many professionals think, Vaughan warns, noting that a complaint by a vexatious patient or the hospitalization of a person following an apparently correctly dispensed medication could be enough to prompt a report.

“It doesn’t matter if you think the claim is unfounded or you don’t think that the patient will sue you,” she says.

Once a claim is opened, Vaughan explains an insurance adjuster will contact the pharmacist, take a statement, investigate the situation and attempt an early resolution.

“The insurer is totally on your side, and doesn’t report to the college or anyone else what is disclosed in the investigation,” she says.

In some cases, Vaughan says a swift and sincere apology can often settle a complaint before the process gets started.

“If your patient comes in to complain about some error, be kind and open, and discuss it with them,” she says. “If there is an error, apologize.”

When files progress to litigation, insurance adjusters take control, instructing a lawyer such a Vaughan on how to handle the action.

“Generally, the insured is not copied on reports, but you have rights to get those reports and review them,” she says, adding lawyers will help the professional prepare for examinations for discovery.

In court, the burden of proof is on the patient to show the pharmacist breached their standard of care and caused them harm. Medication or dosing errors make for relatively straightforward cases.

“Other times it’s a more difficult question,” Vaughan says.

Generally, professionals can protect themselves and boost their cases by making notes of conversations with patients and doctors regarding treatments, she adds.

“Contemporaneous business records are the best evidence,” Vaughan says.

She says many insurers provide tribunals expense coverage when complaints result in action by the Ontario College of Pharmacists.

However, even those without such coverage should hire a lawyer to respond to college proceedings, Vaughan says, noting professionals who take a do-it-yourself approach do not fare well.

“Their responses are argumentative, emotional and often don’t strike the right tone,” she says.

In addition, she says lawyers can provide insight about appropriate approaches to a complaint and better inform pharmacists of their rights.

“Hopefully you will never find yourself in the situation of needing to defend yourself against a claim or to responding to a complaint,” Vaughan says. “But if you do, use the insurance you have paid for, get the professionals on your side and get back to your own businesses and practices.”

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