Disability Royal Commission - Risk & Insurance Next Steps?
We provided an overview of the new Disability Royal Commission announced in the recent client alert.
Below are the steps we recommend you take from a risk and insurance perspective.
Please note the following assumes you are an institution, corporation, or organisation that interacts with persons with disability who has access to or purchases insurance coverage.
In response to the Royal Commission, we strongly recommend taking the following steps immediately.
- If you are an NDIS Accredited provider, or participate in any way with persons of disability, this Royal Commission will apply to you.
- Ensure you notify your insurers (particularly your Directors & Officers Liability/Management Liability, Statutory Liability, Medical Malpractice, and Liability insurers) that your organisation may be called to respond to this Royal Commission.
- Conduct an audit of your files for at least the last 5 years (the Aged Care Royal Commission required responses going back this long) and log any complaints, circumstances, reports or concerns raised of violence, abuse, neglect and exploitation and make a full record of these along with status of action against each. Provide this log to your insurers. Do not wait to action or follow up any of these, instead, be proactive and engage early and often.
- Engage early with legal counsel and public relations consultants to support your organisation. Inform your insurers of the legal counsel you are seeking to appoint early to ensure that there will be no issue with use of that legal counsel in the event there is an indemnifiable claim under any of the relevant insurance policies. Insurers have agreements with lawyers on their panels which reduce hourly rates, and there are a number of very reputable legal practitioners who have already dedicated many hours toward supporting organisations called to other Royal Commissions. Ask your insurance broker to help you get connected with the help you need.
- Keep a record of all legal and operational costs incurred during the process including scope of works, hours billed, costs etc.
- Ensure that you are engaging your board, and/or your executive on a regular basis during this process, and that response to the Royal Commission is a top priority for your organisation
What is happening in the insurance market? How will the Royal Commission affect our insurance program?
- Some insurers are relying on any small basis to decline to provide indemnity, and doing so swiftly, or taking a long time to respond as to indemnity available.
- At renewal of policies, we are seeing some insurers introducing blanket Royal Commission exclusions, reducing or removing cover altogether for abuse, and increasing renewal premiums, and deductibles substantially. Also, some insurers are ‘holding’ on releasing renewal terms, leaving both brokers and insureds with very little ability to negotiate alternatives and often no choice but to renew with the existing incumbent.
- The insurance market is also hardening for the first time in more than 15 years. See Hardening Insurance Market – what should you be doing when it comes to renewal of your insurances? for more information.
This page contains general information and does not take into account your individual objectives, financial situation or needs. Any statements concerning legal matters are based solely on our experience as insurance brokers and risk consultants and are not to be relied upon as legal advice, for which you should consult your own professional advisors.