The what, how and why of PI insurance

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Professional Indemnity insurance (PI insurance or PII) may seem like an uninteresting topic, however, the relevance becomes very clear if there is action taken against you by a regulatory agency or if there is a claim for compensation following an incident.

PII is designed to cover you for what you do in your professional life. In the case of a pharmacist, this means there is cover for incidents such as dispensing errors, vaccinations, incorrect clinical advice, statutory and/or regulatory complaints.

PII cover for registered pharmacists

Registered pharmacists practising in Australia must have PII cover in place – this includes intern pharmacists who hold provisional registration. It is the personal responsibility of all registered pharmacists to ensure that this registration requirement is met. Every year, as part of the Ahpra registration renewal process, pharmacists must sign a declaration confirming that they held PI insurance for the past 12 months and that they will ensure that cover is in place for the next registration period. These declarations are legally binding and Ahpra conducts random audits every year seeking evidence from pharmacists of their PI cover for recent years. Unfortunately, some pharmacists overlook these obligations and find themselves in the uncomfortable position of explaining their oversight to Ahpra, with the risk of a penalty from Ahpra as a possible outcome.

PII cover for registered pharmacists not practising

It is important to note that if you are a registered pharmacist but are not practising for part of a registration period – for example you take maternity leave or an extended holiday – you do not necessarily require PII cover for that period. However, if the PII cover that was in place pre the non-practising period was provided on a ‘claims-made’ basis, you must ensure that you have run-off cover in place for the non-practising period i.e. cover for any claim(s) made against you whilst you are not practising that relate to the services that you provided prior to your temporary non-practising period. To cater for this requirement, the PDL Master Policy provides a Temporary Leave of Absence additional benefit that can be initiated by any member if they are taking a temporary leave of absence in excess of 6 months and up to a maximum of 30 months. This benefit will ensure that PDL members do not experience any ‘gap in cover’ and that professional registration requirements are met.

PII cover for pharmacists no longer practising

Similarly, if you retire, or permanently cease to practise pharmacy, and the PII cover that was in place pre the non-practising period was provided on a ‘claims-made’ basis, you must ensure that you effect run-off to ensure that cover is in place for claims that arise out of, or are a consequence of activities that were undertaken when you were practising. Again, the PDL Master Policy can provide this cover so long as a member notifies us that they have ceased to practise or have retired.

For immediate advice and incident support, call PDL on 1300 854 838 to speak with one of our Professional Officers. We are here to support our pharmacist members 24/7, Australia-wide.

In 2022, PDL celebrates 110 years since being founded in 1912 by Australian pharmacists in Echuca, Victoria. We’re proud to still be independent and fully owned by over 30,000 Australian pharmacist members. We also provide Australia’s market-leading PI insurance for pharmacists, so you can have peace of mind throughout your professional career.