Professional indemnity insurance for occupational therapy

As an occupational therapist, you know just how important your profession is in helping injured, sick or disabled people so they can perform daily tasks to the best of their ability. But what if you provided advice or a service that caused injury or harm to your patients?

Various types of business insurance can protect you and your livelihood in these circumstances, as you’ll discover in this article. One of the most important is professional indemnity insurance*.

What is professional indemnity insurance for occupational therapists?

Professional indemnity insurance for occupational therapy is exactly what it is for other businesses – it offers protection for businesses that provide specialist services or professional advice. If someone makes a claim against your business for losses due to alleged or actual negligent acts in the service or advice you offer, professional indemnity insurance can help.

It can also assist with legal fees for claims which are covered by your policy.

While you do everything in your power to provide the correct guidance and assistance to your clients, mistakes can happen or an accusation can be made against you. In these cases, professional indemnity insurance can cover your legal costs, court attendance fees and other expenses that result from a claim. It typically won’t cover intentional acts that cause harm, damage or injury.

It’s also something many other allied health professionals and businesses need to consider so they’re covered in tricky situations.

Is professional indemnity insurance compulsory in occupational therapy?

It’s a legal requirement for all occupational therapy practices and individual therapists to be covered by relevant professional indemnity cover to operate in Australia. In addition, this insurance must be sufficient to protect a practice if any claim resulting from profession related mistakes, negligence or omission is made, according to the Occupational Therapy Board.¹

If you offer care or your professional opinion on someone’s mental or physical health, professional indemnity insurance will need to cover:

• All locations where you practice
• Any practice, regardless of whether it’s part of the public sector or a private facility
• Everyone you employ, from volunteers to full-time workers.

Why do I need professional indemnity insurance for my occupational therapy clinic?

Aside from being a legal requirement in Australia for occupational therapists, in effect to safeguard the public who use occupational therapy services, professional indemnity insurance is designed to protect your business. If your expertise or advice results in a claim that could cause financial loss, affect your reputation and ruin your business, then this type of insurance could help.

Here are some circumstances where professional indemnity insurance could come in handy, regardless of whether you’re at fault or simply accused of misconduct or negligence:

• You or an employee at your practice provides incorrect information or services to a client
• Someone within your practice makes an accidental omission
• A client’s personal information is breached or lost as a result of error within your practice
• You fail to provide a service or treatment within an agreed timeframe
• A client is injured or killed as a result of your treatment or medical advice

Are my employees fully covered under my practice’s professional indemnity insurance?

Providing you’ve taken out adequate indemnity insurance for your occupational therapy clinic, your employees will be covered when working at your practice. However, some occupational therapists have multiple employers, may operate their own business as a contractor, may work at various locations and could carry out their services in addition to their employment at your practice.

In these cases, that individual would need to be covered wherever and whenever they’re providing their professional services but it would be their responsibility to take out that insurance. They could be covered by their other employer’s cover or may need to take out additional protection.

Are there circumstances where I don’t require professional indemnity insurance for occupational therapy?

There are cases where your occupational therapy business or individual occupational therapists may not require indemnity insurance. These include:

• If you’re practicing overseas. Different countries may have their own rules and regulations around insurance but you won’t require Australian indemnity insurance if you’re practicing abroad.
• When you have a non-practicing registration. If you’re registered as a non-practicing occupational therapist, indemnity insurance isn’t something you’d need. You’d only need to take it out again if you choose to reopen your practice.

Note: In cases where you cease practicing, you may be required to take out run-off insurance – a type of cover that protects you if claims are made for a period where you were practicing. If you’re already covered, talk to your insurer about this to see if it’s something they offer.

What other types of business insurance should occupational therapists consider?

Professional Indemnity insurance is one piece of the insurance puzzle for occupational therapists and there are other types of cover you should consider for your practice to help ensure you and your employees are covered.

The type of cover you consider will be unique to your business and circumstances however, the major types of insurance that could be relevant to occupational therapists include:

• Public liability insurance*. Say a client, member of the public or one of your suppliers becomes injured or has their property damaged as a result of an accident in your practice. Public liability insurance could cover you and your occupational therapy clinic if a claim is made.
• Personal accident insurance*. Your job and business focuses on helping others get back on their feet and perform tasks to the best of their ability. If you were to become ill or injured and unable to work, this type of insurance can provide you with loss of income coverage until you’re able to practice again.
• Management liability insurance*. Even if you do your best to ensure you’re running your practice to a high standard, claims against your management team regarding wrongful dismissal, harassment, crime or management styles could leave your practice struggling. Management liability insurance could protect you if a claim like this arises.
• Cyber Liability* All occupational therapy practices use computers or digital technology to some extent, whether it be to process payments online, communicate via email or provide information on a website. If there was a data breach or your business couldn’t operate as a result of a cyber issue, this extra type of cover might be the protection you need.

Depending on the size of your occupational therapy clinic and how many employees you have, you may also wish to consider purchasing Business Package insurance*, which can be tailored to include one or more of the following: