An insurance expert explains vicarious liability, which has been in the spotlight recently, and sets out the options open to surgeries seeking reassurance they won’t be caught out by it.

Question from Management in Practice reader:

I’m a GP at a mid-sized practice. I’ve been made aware that it’s possible for a practice as an employer to be sued because of an alleged mistake made by an individual GP or clinician undertaking private work on behalf of the practice, risking the future of the business and the partners losing their assets. Is this the case and are there any measures we can take to protect ourselves against such a claim?

 Answer from Ian Smith, Divisional Director – Head of Primary Care at Howden Insurance Brokers Limited:

The background to this is I suspect this case, which first received media attention in 2025 but has since been reported on this year too. The GP partners faced millions of pounds of legal costs because of the actions of one of its salaried GPs and who is being sued. This is called vicarious liability – where one party, such as an employer, is held responsible for the actions of another, such as an employee.

In this case, the partners in the practice each had cover with a medical defence organisation (MDO). Since the salaried GP’s MDO couldn’t guarantee it could cover the cost of the potential damages, lawyers representing the injured party extended the claim to the partners in the practice too under vicarious liability.

However, their MDO said they weren’t covered for this, leaving them worried that their own personal assets were on the line since they are a partnership, not a limited company.

It has worried a number of GP practices, such as yours, that don’t want to fall into the same trap. However, the real issue is a lack of understanding that medical defence organisations typically only provide discretionary indemnity. This effectively means that it is purely up to the MDO whether you receive any help or financial support should a claim ever be made against you.

So, assessments are made on a claim-by-claim basis even though they say the amount of cover is unlimited.

An alternative option is to arrange insurance to cover the practice against claims such as this.

The advantage of this is that it is a contractual agreement offering specific coverage based on the terms and conditions outlined in the insurance policy you take out with them. It means that if the practice is sued, it is protected.

You will need to talk to your broker to find out more and arrange cover.