Escalating claims against doctors and other healthcare practitioners has recently led the UK's Medical Defence Union to set up their own insurance company in Guernsey.
The Medical Defence Union Ltd. formed in 1885 is the UK's oldest medical defence organisation, providing help and advice to over 140,000 doctors, dentists, nurses and other healthcare practitioners and specialists. Today, it also provides access to legal assistance and discretionary indemnity for a membership which has expanded to include Australia, Ireland, Malaysia, New Zealand, Singapore and South Africa.
Thirty years ago claims against the members of MDU amounted to less than L30,000 in total. Today, the propensity to seek damages through litigation and other means led to MDU paying over L36,000,000 in indemnity and legal costs in 1994.
This increase in litigation is expected to continue, not least because the American style "no win, no fee" conditional fee system has been adopted in the UK. To counter these trends MDU took the decision in 1995 to undertake a complete review of their claim funding structure.
The result has been the establishment in Guernsey of MDU Insurance Company Ltd., which will utilise the wide range of benefits available to insurance companies on the island. Because of the scale and complexity of the insurance programme it has taken 9 months to finalise the structure. Finally on 15 December 1995, MDU Insurance received its final approval from the Guernsey Financial Services Commission in time to commence business on 1st January 1996.
At the ceremony to present the company's insurance licence, Mr. Stephen Butterworth, Superintendent of Insurance at the Commission, congratulated MDU on choosing Guernsey "With sixteen other captive insurance domiciles bidding for your business, we know that our island's resources have to be the best in the world to attract your business". Mr. Butterworth also announced that the total new captive formations in Guernsey in 1995 was again a record, reinforcing Guernsey's position as the largest captive domicile in Europe.
Dr Christopher Earl, Vice Chairman, of the parent company, The Medical Defence Union Ltd., and Director of the new insurance company subsidiary, said, "The efforts of the States of Guernsey and the Guernsey financial community to help us achieve our aims have been exemplary and of the high standard that our membership seek to achieve in their own professional work."
MDU Insurance Ltd. is managed by UNISON Management (Guernsey) Ltd.
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