Medical Indemnity First Principles Review

Page last updated: 31 October 2017

First Principles Review of the Indemnity Insurance Fund

Update: The public submissions to the First Principles Review have now closed.
In line with the Australian National Audit Office’s recommendations, and as announced on 19 December 2016 in the 2016-17 Mid-Year Economic and Fiscal Outlook, the Department is undertaking a First Principles Review (FPR) of all the Commonwealth funded schemes under the Fund (including the midwife professional indemnity schemes) and a Thematic Review of all legislation underpinning the Fund’s schemes.

Medical indemnity insurance provides financial protection (to the extent set out in the insurance contract) to both medical practitioners and patients in circumstances where a patient sustains an injury (or ‘adverse outcome’) caused by negligence or an otherwise unlawful act. All medical practitioners and midwives are required to hold medical indemnity insurance in order to practice privately, as a condition of their professional registration.

The objectives of the Indemnity Insurance Fund (IIF) are to promote stability in the medical indemnity insurance industry, keep premiums affordable for doctors and ensure availability of affordable professional indemnity insurance for eligible midwives. The IIF is comprised of seven Commonwealth government assistance schemes:
  • Premium Support Scheme – incorporating the grandfathered Medical Indemnity Subsidy Scheme;
  • High Cost Claims Scheme;
  • Exceptional Claims Scheme;
  • Run-Off Cover Scheme;
  • Incurred-But-Not-Reported Scheme;
  • Midwife Professional Indemnity (Commonwealth Contribution) Scheme; and
  • Midwife Professional Indemnity Run-off Cover Scheme.

Terms of Reference

The First Principles Review provides an opportunity to examine whether existing arrangements are ‘fit for purpose’ for all parties or whether changes can be made that better support the ongoing provision of indemnity insurance. Outcomes of the First Principles Review will inform future policy concerning support for professional indemnity insurance for doctors and eligible midwives in private practice and contribute to the development of an appropriate monitoring framework to assist in assessing how the schemes are contributing to affordable access to healthcare.
The terms of reference for the Review are to:
  • examine to what degree, in the current environment, Commonwealth intervention has been successful in providing:
    • stability of the medical indemnity insurance industry;
    • availability of affordable indemnity insurance for medical practitioners and midwives and by extension, the affordability of healthcare for patients;
    • viability for professions, and patients, where claims have a ‘long-tail’ or high costs;
  • assess whether the schemes that comprise the IIF continue to be fit for purpose for all parties, and where improvements might be made; and
  • consider the appropriate level of Commonwealth support needed to continue stability, affordability and accessibility of professional indemnity insurance for medical practitioners and eligible midwives.

Submission Process

On 31 August 2017, the Department invited submissions from all interested parties to inform the Review. All comments and perspectives were encouraged on whether the schemes continue to be fit for purpose, their strengths and weaknesses, and any suggested improvements.

Discussion Paper - FPP for IIF (Word 209 KB)
Discussion Paper - FPR for IIF - August 2017 (PDF 816 KB)

Following an extension to the deadline indicated in the Discussion Paper, the submissions closed on Friday, 13 October 2017.

The Department thanks all parties who made a submission.

Submissions Received


Submissions were forwarded to the Department in a range of formats including Word, RTF and PDF, and have generally been published in their original format.

If you are unable to access any of the documents please contact:


Submissions classified by the author as 'Confidential' have not been published.


To ensure that the privacy of individuals is protected, some submissions have not been published. Contact details (eg, addresses, phone numbers and email addresses) contained in submissions have also been removed.

NOTE: The views expressed in submissions are those of the authors and copyright in submissions remains with the authors, not with the Department.

Australian College of Midwives (PDF 405 KB)
Australian College of Rural and Remote Medicine (PDF 204 KB)
Australian Commission on Safety & Quality in Healthcare (PDF 2788 KB)
Australian Health Practitioner Regulation Agency (PDF 40 KB)
Australian Medical Association (PDF 623 KB)
Australian Society of Anaesthetists (PDF 797 KB)
Australasian College for Emergency Medicine (PDF 400 KB)
Avant (PDF 536 KB)
Health Professionals Australia Reform Association (PDF 194 KB)
Insurance Council of Australia (PDF 131 KB)
Medical Indemnity Protection Society (PDF 608 KB)
MDA National (PDF 144 KB)
National Association of Specialist Obstetricians and Gynaecologists (PDF 953 KB)
Royal Australian College of Dental Surgeons (PDF 126 KB)
Royal Australian College of General Practitioners (PDF 509 KB)
Royal Australian & New Zealand College of Obstetricians and Gynaecologists (PDF 111 KB)
Royal Australasian College of Surgeons (PDF 48 KB)
Rural Doctors Association of Australia (PDF 371 KB)
The Royal Australasian College of Physicians (PDF 111 KB)
The Royal Australian and New Zealand College of Ophthalmologists (PDF 272 KB)
The Royal Australian and New Zealand College of Psychiatrists (PDF 112 KB)

Thematic Review of Legislation

The Department is also conducting a Thematic Review of the Commonwealth’s medical indemnity legislation. The purpose of this review is to consider relevant indemnity legislation with a view to simplifying and streamlining the legislation, with a particular focus on deregulation. For example, deregulation opportunities exist through repealing redundant legislation and possibly streamlining multiple instruments into single instruments.

Enquiries or feedback regarding the reviews can be sent to: