Two terms decide whether a medical indemnity policy actually responds when you need it, yet they are rarely explained in plain language: claims-made cover and your retroactive date. Get them right and you have seamless protection across your whole career. Misunderstand them and you can have a policy in force and still find a claim falls outside it. This is the explanation every clinician should have had on day one.
Claims-made, in one sentence
A claims-made policy responds to claims that are first made against you and notified to your insurer while the policy is in force— regardless of when the underlying incident occurred. This is the standard form of cover for medical indemnity in Australia, and it works very differently from the “occurrence” cover you might know from car or home insurance.
Claims-made versus occurrence
Under occurrence cover, the policy that responds is the one that was in force at the time the event happened. Under claims-made cover, the policy that responds is the one in force at the time the claimis brought. Because a patient may not allege harm until years after the care was provided, this distinction is the heart of how medical indemnity behaves — and why continuous cover is so important.
With claims-made cover, it is the policy you hold when the claim arrivesthat pays — not the policy you held when you treated the patient.
The retroactive date: how far back you are covered
If a claims-made policy looks at when the claim is made, what stops it being unlimited — covering every incident from the start of your career? The answer is your retroactive date. It is the date from which past incidents are covered. A claim arising from care you provided before your retroactive date is not covered, even if the claim itself is made today while your policy is current.
In practice, your retroactive date is usually the date your continuous medical indemnity cover first began. As long as you have held cover without a gap, your retroactive date reaches back to the start of that unbroken chain, and your current policy responds to a claim about care from any point along it.
Why continuous cover matters so much
Put the two ideas together and the reason continuity is everything becomes clear. The policy that pays is the one in force when the claim is made; and it only reaches back as far as your retroactive date. So a gap in cover is dangerous in two directions at once:
- During a gap, no policy is in force to respond to a claim made in that window.
- A new policy taken out after a gap may carry a later retroactive date, leaving the period before it permanently uncovered.
This is also why the regulatory framework cares about it. In Australia, the Medical Board’s registration standard requires not just professional indemnity cover but appropriate retroactive coverfor your prior practice. Maintaining your retroactive date when you switch insurers is therefore not a nicety — it is part of meeting the standard.
Switching insurers without losing your history
The good news is that changing providers does not have to reset your protection. A well-run insurer will recognise your existing retroactive date and carry it forward, so your new policy responds to claims about care going back to when you first held continuous cover. When you move cover, the single most important thing to confirm is that your retroactive date has been preserved — ask for it explicitly and check it on your schedule.
What happens when you stop practising
Because claims can surface years later, a claims-made policy leaves a tail of risk after you retire or cease practice. The cover ordinarily lapses when you stop paying for it, which would leave late claims unanswered. This is solved by run-off cover, and for eligible doctors the Commonwealth’s Run-off Cover Scheme provides it — a topic worth a read in its own right.
The takeaways
- Claims-made cover responds to claims made while the policy is in force.
- Your retroactive date sets how far back your cover reaches.
- Care before your retroactive date is not covered, even for a claim made today.
- Gaps in cover are dangerous — continuity protects both ends.
- When switching insurers, confirm your retroactive date is preserved.
When you build a quote with Praxis we carry your existing retroactive date forward. Start your estimate, or read on about run-off cover.