Professional indemnity

Who concludes the insurance?
MANDATORY “PROFESSIONAL INDEMNITY” INSURANCE is concluded by employees of different categories:- doctors and medical staff;- lawyers and notaries;- designers, architects, engineers;- certified accountants and auditors;- private enforcement agents;- insurance brokers.The “professional indemnity” insurance may be voluntarily concluded by other professions as well.

What does the insurance cover?
THE INSURANCE COVERS THE FOLLOWING RISKS: Depending on the clause and in accordance with the general and special exceptions, the insurer must compensate the insured party, up to the agreed limit, for the amounts he is obligated to pay, as per the Bulgarian legislation, to third parties for claims, submitted to him in writing for the first time during the insurance period, for damages caused by the violation of his professional obligations while performing activities, defined in the agreement, due to negligence, error or omission, performed/allowed by the insured party, his associate or employee, including subcontractors, agents or consultants acting in his behalf and for which he is responsible while they perform their professional activities, during the insurance period.

THE GENERAL EXCEPTIONS ARE: War, strike, civil upheavals;Losses, damages and costs incurred due to acts of terrorism;Nuclear reaction, toxic pollution;The insured party’s actions outside the range of his professional activity;Intended damages caused by the insured party;The violation of rights over intellectual property, trademarks, patents;Actions qualified as defamation and insult;Loss and damage to documents, trusted to the insured party;The insured party’s liability, assumed under an agreement, which would not arise under other legal grounds;Damages caused due to force majeure circumstances;Claims filed under foreign legislation;Loss of future earnings;Default and indirect damages;Penalties, confiscations and other fines implemented by competent bodies;Activities performed by the insured party abroad.

THE INSURANCE DOES NOT INCLUDE: Actions beyond the range of the insured party’s professional activity;Administrative violations, failure to realize payments or payment delays for taxes, fees and other obligations to the state;Loss or damage to documents trusted to the insured party as well as the cost of their recovery;Claims by parties in the capacity of linked persons with the insured party.

What are the different professions insured for?
DOCTORS AND MEDICAL STAFF: As per the Health Act, all medical institutions in Bulgaria are to conclude mandatory insurance for persons practicing a medical profession in the medical institution, for damages which may occur due to intended default of their professional obligations. Insurance must also be concluded for doctors and nurses in hospitals as well as such persons who work in tissue banks or blood centers. The purpose is for all of them to be protected in case they err and damage their patients, or cause their death. If the patients or their relatives demand compensation, the insurance should cover at least a part of it.

LAWYERS AND NOTARIES: The insurance joins different types of financial liability for different categories of persons (lawyers, notaries, architects, certified accountants, etc.) which may cause material and moral damages to third parties during the performance of their professional obligations. The insurance subject is the insured party’s material interest in respect to the liability for damages caused to third parties due to an error or omission allowed while practicing the relevant main profession. The requirements which apply to a certain profession are legally and statutorily regulated.

DESIGNERS, ARCHITECTS, ENGINEERS AND INDEPENDENT CONSTRUCTION SUPERVISION: The coverage includes risks related to the professional liability of a person, indicated in the insurance policy, in relation to claims submitted during the insurance period and/or during an additionally agreed extended notification period, for notifications regarding claims submitted for damages and financial loss caused to third parties with whom the insured party has legal relations during the performance of his professional activities.

CERTIFIED ACCOUNTANTS AND AUDITORS: The “Professional liability for certified accountants and financial auditors” insurance is compulsorily concluded by persons performing auditory activities, as per the Independent Financial Audit Act.

PRIVATE ENFORCEMENT AGENTS: Compulsory insurance as per article 25 of the Private Enforcement Agents Act, in force since 01.09.2005 and Ordinance №2/06.02.2006 of the Ministry of Justice for the compulsory insurance for private enforcement agents. The “Professional liability for private enforcement agents” insurance must be concluded by any private enforcement agent who received his legal capacity as per the Private Enforcement Agents Act.

INSURANCE BROKERS: The “Professional liability for insurance brokers and insurance agents” insurance is compulsorily concluded by the persons performing such activities, as per the Insurance Code and the Ordinance for the insurance broker and the insurance agent.

AIRLINE TICKET SALE AGENTS: The purpose of the “Airline ticket sale agent liability” insurance is to compensate airline companies in case the agencies are not reimbursed for owed amounts which are realized as a result of the sale of tickets for passengers and loads.

How is the insurance premium determined?
LIABILITY LIMITS ARE SELECTED BY THE INSURED PARTY and are negotiated separately between the insured party and the insurer in the insurance contract for: a person harmed by one event, for all persons harmed by one event and in total for the insurance period. The insurance premiums are determined depending on the liability limit selected and the type of profession practiced.

Individual health insurance
When concluding it the insured party selects the package of health services he wishes to use by himself. The main packages are for:Health prophylactics – includes health services for health protection and the early diagnosis of illnesses;Healthcare assistance provided up to hospitalization – includes initial and secondary examinations and testing with a freely selected doctor, in non-hospital ambulatory and home conditions;Hospital medical assistance – includes diagnosis and treatment of insured persons in clinics and wards of multi-profile and specialized hospitals for active treatment, manipulations and operations;Reimbursement of medicine costs – offers the possibility to reimburse expenses incurred for buying medicines and technical aids;Dentistry – provides services related to the control of oral cavities.

Group health insurance
Provides coverage for physical harm caused due to an accident which caused the loss of work capacity or the death to a group of persons. This group may consist of all or some of a certain company’s employees, the members of an association or club, as well as the clients of a certain organization. The insurance coverage may be used independently or as an addition to existing insurance coverage.More and more companies are realizing that it is better to keep their key staff members using convincing social benefits than to leave them looking around for opportunities with the competition. In this sense, the most powerful benefit is healthcare. Health insurance is an extremely comfortable and modern tool for an employer to secure his employees.Companies which have employees, protected by health insurance coverage, provide a signal of stability and long-term intentions towards the rest of the market – competitors, contra-agents and clients. Health insurance is offered by the employers as an additional benefit to the salary.