Should Vicarious Liability Insurance be split among associate dentists?

Commercial Manager, Kabir Ahmed, for Wesleyan Financial Services, shares his views on the topical question of whether vicarious liability should be split among associates.

Negotiating an agreement whereby associates contribute towards insurance costs, may be a possible option, however, it’s worth bearing in mind that it is likely that the legal burden of vicarious liability will typically fall on the principal dentist or practice owners.

This is due to a number of factors, including the patient’s perspective, regulation, the law and legal precedents.

If we start by considering the point of view of the patient, my understanding is, that on the whole, patients tend to choose the dental practice, rather than any individual dentist or other care professional within the practice. If we consider what attracts a patient to a practice, it may well be due to its reputation within the local area, its use of practice marketing and of course the seal of approval of a referral from family, friends or acquaintances. Therefore, if an associate is alleged to have been negligent in some shape or form, it is likely that the patient or their legal representatives would seek compensation from the practice in the first instance. This may be due to a belief that out of the practice and the associate, it is the former that has the “deeper pocket”.

If we move on to the law and legal precedents - vicarious liability refers to a legal principle where the employer/business owner is held responsible for the actions of its employees, associates and contractors. In the eyes of the law, it is seen as the responsibility of the business. There have been several high-profile legal cases where practice owners have been held accountable for the actions of associates. In those cases, the courts have upheld the belief that the patient’s relationship is with the practice and not the employees/associates, and therefore principals are responsible for any alleged errors, negligence or breaches of care -irrespective of which individual delivered the care.

Finally, from a regulatory point of view, according to the General Dental Council’s (GDC) guidance, the principal/practice owners are responsible for the standards of safety and care provided by the practice’s employees and associates. The GDC expects practice principals to ensure that a) an adequate system is in place to monitor clinical standards, b) that all employees and associates are competent and properly indemnified for the undertaken work, and c) that the patient care delivered, meets the expected ethical and clinical standards. Whilst the GDC holds the associate accountable for the clinical work, they also hold the practice to account for the environment in which the care is provided.

Ultimately the legal argument is establishing the relationship between the patient, the practice and the associate - this is where it can be useful to seek professional legal advice.

From an insurance perspective, in most cases, principal and associates’ individual indemnity cover should be sufficient for protection for alleged negligence claims. However, given the increased legal challenges, taking out an entity level cover offers protection that includes vicarious liability. This ultimately means that if you are a principal, you don’t have to check if your associate’s insurance lapses, is inadequate, or if the associate is difficult to locate after leaving your practice. Some principals may wish to encourage associates to contribute to the overall insurance policy – this is something that could perhaps be included in the contract. Entity level cover also offers other benefits in terms of costs, a simplified claims process, and the protection of the practice and its reputation.

Often the cost of combined insurance – for example, a policy that covers all treatment/guidance given by any member of the practice - can be more cost effective than the sum of all the individual policies – resulting in lower costs for both principal dentists and associates as well as simplifying the claims process. This type of policy is also beneficial to the reputation of the practice, as it removes the burden of finding an individual responsible - as that one policy would react to the claim. It is important to note however, that dental practices differ considerably in terms of their individual requirements and what is suitable for one practice may not be for another – this is why it’s a good idea to talk to a specialist broker who understands the complexities of a dental business and the risks associated within it.

Wesleyan Financial Services Limited is a broker and its insurance products are provided by a number of selected insurers.

For support and guidance on liability insurance for your practice or to obtain a quote, get in touch with the team by calling 0800 231 0826 or visit Insurance for dentists | Wesleyan or email: This email address is being protected from spambots. You need JavaScript enabled to view it.

Wesleyan Financial Services Ltd (Registered in England and Wales No. 1651212) is authorised and regulated by the Financial Conduct Authority. Registered Office: Colmore Circus, Birmingham B4 6AR. Telephone: 0345 351 2352. Calls may be recorded to help us provide, monitor and improve our services to you.