Public liability insurance is critical for vets who run their own practice but what are the other business insurance options that will keep your business fully covered? James Gallaway investigates
Veterinarian Kay Weller was alone in the Bowral Veterinary Hospital when she heard the explosions. A fire, burning in Reekies Tyres next door, had LPG fuel tanks on a forklift blowing up in the flames. As the fire took hold, Dr Weller, who was alone in the practice with a small group of pets, had to move fast.
“It was unusual and fortunate for us not to have had any surgery on the day the fire happened,” says business partner Dr Angus Hayes. “We actually had a dog booked in for a caesarean but she gave birth to pups at home the day before.”
As blazes go, the tyres and motor vehicle equipment in Reekies provided conditions for the perfect storm. That afternoon, the intense fire raged for hours as fire crews worked to extinguish the blaze. Inside the hospital, Dr Weller, with the assistance of local police first on the scene, got animals out as the fire reached the roof of the tyre shop. “Again, we were lucky,” says Dr Hayes. “It was only a small group of dogs and a cat. The police—some of whom were our clients—were a great help.”
When it was over, Reekies Tyres was left in a pile of toxic smoking ash. “Because the remains of the tyre shop were leaning on our practice, our building was considered unsafe to enter for a very long time,” explains Dr Hayes. “We got a peek inside and found that the fire had spread through our roof. The structural concerns made it weeks before we could properly rescue whatever was salvageable.”
Every day that followed, until they were up and running four months later, required calm resolve to deal with uncertainties and changing plans.
“We went through our insurance policy to be sure we were covered and got phone lines and the server up and running with client records,” says Dr Hayes. “We operated out of my living room for a week or two and every day needed a new plan of action to keep the practice alive. We looked hard for silver linings.
“We had to keep our clients informed and build strong connections. But Australians, particularly in rural areas, are sensitive to the catastrophe fires bring, even if it’s just people stopping by with messages of support and offering to help.”
“We operated out of my living room for a week or two and every day needed a new plan of action to keep the practice alive. We looked hard for silver linings.”—Dr Angus Hayes, partner, Bowral Veterinary Hospital
Dr Hayes says the practice eventually settled on a shopfront in the main street of Bowral. “The local market let us have a stall where we could reach out to clients. And our clients were understanding about the challenges we faced in keeping our patients supplied with food and medications.”
He says, also, that working out of the shop front taught him new things about setting up a practice. “Leases are for business premises that often have only one tap, but a vet will need many more, plus suitable floor coverings, in a building that can secure animals.
“We got a new roof, new ceiling, new walls and lighting, and it was great to have a new colour scheme. I certainly would have chosen a less dramatic way of going about it though. We had business interruption insurance, which covered us for wages and other costs while we were in difficulties.
“Of course, we had the full range of other insurance for public liability and professional indemnity, but the ‘business interruption’ cover really helped us through,” says Dr Hayes.
“It’s a sobering moment when vets work through their strategy and planning with our account managers,” says Matthew Richardson, client partnerships executive with Guild Insurance, the principal insurance partner of the Australian Veterinary Association . “They begin to understand what can happen if their insurance is not up to date.
“We work through their insurance portfolio thoroughly and discuss all possible scenarios: what would a veterinarian require if their practice is unable to trade? It’s about realising there are worst-case scenarios and deciding on how to protect yourself through transfer of risk.”
Richardson also recommends that people avoid cutting corners with insurance. “Saving money by cutting back on coverage and policy limits is a faulty strategy that can lead to financial disaster. Our Emergency Animal Disease Response insurance policy is the first of its kind and the only one that provides specialist cover for veterinarians involved in the outbreak of a notifiable disease.”
Essential business insurance for veterinary practices
- Professional indemnity insurance: Let’s start with the basics. Vets need to insure themselves for professional indemnity. Guild Insurances’ Matthew Richardson says this is an insurance essential for practice owners to protect themselves from the professional advice given by themselves, employees, consultants, contractors and locums. “Vet practices are in a more significantly litigious environment than ever,” he says. “Recent increases in litigation and reported incidents have mirrored increases in cost involved in defending our clients. Without a specialised, professional indemnity insurance policy specifically designed for the industry, the assets of vets—both on a business and personal level—are at great risk.”
- Public and products liability insurance: Along with professional indemnity, public and products liability insurance should be mandatory due to the risk of paying compensation and legal expenses for third-party personal injury and/or property damage.
- Worker’s compensation insurance: Owners at a practice have a legal obligation to insure direct employees, and in some cases, contractors. Insurance covering this should be in place before any employees are hired.
- Management liability insurance: Management liability protects you against employment practice liability, statutory liability, and the personal assets of the directors and officers as well as theft by staff.
- Business asset insurance: Business asset insurance covers assets such as buildings, contents, stock and machinery, when they have to be replaced or repaired in the event of a natural peril (storm, wind, water), a disaster such as a cyclone, the actions of a criminal, or, in some cases, accidents.
- Business interruption insurance: The fire that devastated the Bowral practice showed how business interruption insurance can help a practice pay for a temporary facility, and cover a downturn in lost revenue and the wages of employees while the practice recovers. “Policies should be reviewed annually to be certain the level of cover is in line with requirements and current circumstances,” says Richardson.