Having worked with practice managers for nearly 9 years in reducing insurance costs I have to admit that I am not envious of the challenges they face running or managing a modern medical practice. I am fortunate to have a good relationship with many who explain to me the different challenges they face, often to meet their budgets in an organisation where the 'goal-posts' are forever changing. One wonders whether this profession is becoming specialist in its own right and I wonder how long it will be before a University recognises this and creates a degree around the vocation?
However the downside of paddling furiously in any organisation is often things that 'roll over' for another year are often the 'small fish' to slip through the net and this is where as a financial professional I am concerned. More often or not a review of Surgery and Locum Insurance is seen as a low priority. Often passed to a part time member of staff or a deputy in a wish to clear desks for the most important areas. However in my opinion this results in false economy for the practice and ultimately the patients.
Historically any policy a practice has had for a number of years been with the same provider will suffer from 'roll over' and not be competitive. The effect of the premium increasing ever so slightly every year. The other flip side to this is if there has been a claim within those 12 months the insurance company often or not will try and recoup this money at renewal with an increased premium. What one should consider though is that any claim may have been a one off and therefore not affect the risk to a new insurer coming in. A new insurer after all is assessing the risk at the point of application. They will of course take into account past claims however as it has not effected them financially there is every chance they will be able to offer a more competitive premium than your current policy.
For larger practices we could be talking for a group scheme of around 6-10 members (depending on age) anywhere between £5000 - £10000 in premium. Recently a practice in West Yorkshire was paying £18500 per year and we managed to bring the premium down by £8500 by switching to a new provider without sacrificing cover.
The reality is the premiums of both locum and practice insurance are too high not to be reviewed every 12 months at least. There should in my opinion be a considered attempt to get the best value for money a medical practice can get on their insurance's regardless of how busy they are (whilst not sacrificing quality of cover).
There is also surely a moral obligation for an NHS practice to get the best value of money it can get for the tax payer? It is true to say that the funding for GP Practices is an extremely complicated area with the global sum being made up of various factors. However personally I would much rather money saved on insurance premiums go into other areas of patient care whether that means employing a part time administrator or even a few toys for the waiting room.
At www.GPlocuminsurance.com we do not charge a fee for reviewing a medical practice's policies. Neither is there any obligation to change. Like any professional financial advisor we offer you independent advice and we then leave it with you to decide what is best for your practice.
The next time your renewal is around (where the current insurer sends the paperwork out as close to the renewal date as possible) think to yourself for the sake of a 5 minute online form isn’t it worth checking your practice is getting the best value for money?
Chris Dixon BSc (Hons)