7 common insurance mistakes

Eddie Hooker, founder and chief executive of Hamilton Fraser, shares the seven ways people come unstuck with their insurance

EDDIE HOOKER

Founder and chief executive of Hamilton Fraser, Eddie Hooker is an expert in the cosmetic insurance sector with over 26 years of experience. Hamilton Fraser was the first company to offer medical malpractice insurance specific to the cosmetic industry in 1996 and Fraser is passionate about continuing to raise standards in the sector.

Hands up if you read the small print. Whether it’s agreeing to terms and conditions or accepting cookie notifications, many of us are guilty of not fully reading the wording before clicking ‘accept’ or signing on the dotted line. But when it comes to your insurance, you need to make sure you read everything thoroughly. The last thing you want is to get caught out because you haven’t read and understood the terms of your policy properly.

Our claims team has seen this happen time and again. In this article, I share seven common areas where people come unstuck and give advice on the simple steps you can take to keep compliant with your policy and avoid any unnecessary headaches should a claim be made against you.

1. Photos and records

Proper documentation is crucial when it comes to insurance claims. Yet many people fail to maintain up-to-date records or take necessary photographs of their property or belongings. For example, did you know that some policies require that before and after photos are taken for all injectable treatments? Make sure you familiarise yourself with your policy conditions (see below). Without these, proving the extent of a loss can be challenging. Always keep detailed records and regularly update them to reflect any new purchases or changes. You should keep patient records and data safe and save them for 10 years so that you have evidence if a claim is made in the future.

2. Reading the terms and conditions of your policy

Insurance policies are often filled with jargon and lengthy terms and conditions that many policyholders neglect to read thoroughly. This can lead to misunderstandings about what is covered and what is not. It is essential to read and understand the terms of your policy completely, and if needed, seek clarification from your insurer on any points that are unclear.

“When people take out a policy, they often don’t read the policy wording in full”, explains Emma Bracchi, Hamilton Fraser’s senior client services technician. “It is really important that you read the conditions. A lot of the claims we get that are not covered are where the conditions haven’t been met. It is a relatively small section of the wording. That sets out everything from record keeping to patch tests. When it comes down to certain types of laser treatments, there are conditions around minors, etc.”

3. Notification of claims/potential claims

Making sure you notify your insurer of any claims or potential claims is crucial because delays can result in claims being denied. As soon as an incident occurs or you become aware of a potential issue, you should notify your insurer immediately. For example, if a patient expresses dissatisfaction with treatment, informing your insurer early can help manage the situation more effectively.

“Practitioners often don’t tell us something has happened until they receive a letter of claim. But with our terms and conditions, they need to notify us as soon as possible”, explains Emma.

You need to contact your insurer when:

• A patient expresses that they are not happy with the treatment directly after the procedure. This is a very common issue. We suggest that the patient is booked in for a follow up review. You should contact your insurer as soon as possible before the review so that they can make a note on your file and give you our professional advice on what options are available to you in case the patient is still dissatisfied following the session

• If you receive any written or verbal dissatisfaction from a patient or their representatives following a treatment. You may receive a complaint days, weeks, months or even years after a treatment is carried out, as a patient has three years and four months to report any medical malpractice claim

• As soon as you are made aware of the dissatisfaction. We can give you advice on how to deal with the situation

• If a treatment has been administered incorrectly or an injury has occurred to the patient, you need to notify your insurer immediately. At Hamilton Fraser, we assist with the majority of dissatisfactions in-house; however, in the event of bodily injury, solicitor involvement, or a request for compensation, we set up a claim and notify the insurers. The insurers and solicitors are here to help and will defend you if you have not been negligent. In cases where an error has been made, they will deal with the matter on your behalf and attempt to resolve the matter without the courts’ involvement.

And remember:

• Do not admit liability

• Do not respond to a patient or their representatives until you have spoken to your insurer

• Do not disclose you have an insurance policy, and do not provide any details.

4. Amending/updating policies

Life changes, and so should your insurance policy. Whether you’ve added new treatments, moved to a new location, employed new staff or made other significant changes, it’s important to update your policy accordingly. Failure to amend or update your insurance policy to reflect changes can result in underinsurance or lack of coverage when you need it most.

“A lot of claims we notice involve practitioners not listed on the policy”, says Emma. “When it comes time to renew, you find out someone has been at the practice for two years, but we weren’t notified last year or the year before when it came time to renew. That is where claims can get kicked out. Everything like that would be noted in the schedule, so you must read that when it comes to renewing.”

5. Underinsurance

Underinsurance occurs when the coverage limits of your policy are insufficient to cover the full value of your assets or potential liabilities. This can happen if policies are not regularly reviewed and updated. Conduct periodic reviews of your coverage to make sure that it remains adequate for your needs and that your policy limits are in line with the current value of your assets .

6. Material fact changes

Any significant changes that could affect the terms of your insurance policy must be communicated to your insurer as soon as possible. This includes changes in the use of insured property, new business activities, or changes in the health condition of the insured person. Not disclosing these changes can lead to claims being denied or policies being voided.

7. Private/corporate company difference

Make sure you have the correct type of insurance for your needs, whether private or corporate. Corporate policies often have more complex terms and may cover different risks compared to private policies. Understanding these differences and making sure that you have the right type of policy in place for the specific needs of your business is crucial. For example, a corporate policy may exclude claims brought by related parties, which might not be the case in private policies.

By being aware of these common pitfalls, you can make sure you are covered, and if a claim is made against you, things can go more smoothly.