Settlement of €45m over indemnity

The Government is expected to announce today that it has received €45 million as part of a settlement with a medical indemnity company, the Medical Defence Union, over who should pay for the cost of claims made against doctors who were covered by the organisation.

For decades the State paid or subsidised the premiums paid by doctors to the firm, one of two UK-based private companies which provided indemnity cover to the medical profession in the State.

However, the organisation is not an insurance company but a mutual organisation and the payment of claims against members is discretionary.

When the government put in place a clinical indemnity scheme for public hospitals and consultants about 10 years ago the company contended the State should assume the historic liabilities of its members.

The indemnity body argued the scheme deprived it of income to meet its liabilities.

When no agreement was reached with the then government, the organisation refused cover to its existing and former consultant members in Ireland.