Dental practices have insurance exposures that extend well beyond the Professional Indemnity insurance held by individual dentists.

A modern dental practice may have substantial investment in specialist fit-out, dental chairs, imaging equipment, CAD/CAM technology, sterilisation equipment and other medical equipment, as well as exposure to business interruption, cyber incidents, public liability, employees and management risks.

Mercantile Insurance Brokers can arrange and review insurance programs for dental practices and dental groups throughout Australia.

Our focus is on protecting the dental practice as a business — including the practice entity, premises, equipment, income, employees and other commercial exposures.

What Insurance Does a Dental Practice Need?

The appropriate insurance program depends on the size of the practice, services provided, ownership structure, number of practitioners, locations and value of specialist equipment.

A dental practice insurance program may include:

Insurance	What It Is Designed to Protect
Property Insurance	Dental fit-out, equipment, contents and other insured property
Business Interruption	Loss of insured income and additional operating costs following insured property damage
Equipment Breakdown	Breakdown of specified dental, electrical and electronic equipment
Practice Entity Professional Indemnity / Liability	Certain professional liability exposures of the dental practice entity where required
Public & Products Liability	Certain third-party bodily injury and property damage claims
Cyber Insurance	Cyber attacks, privacy breaches, ransomware, data restoration and related interruption
Management Liability / D&O	Certain claims involving directors, officers, management and the organisation
Workers Compensation	Workplace injury insurance required under the applicable State or Territory scheme
Motor Insurance	Vehicles owned or operated by the dental business where applicable

Not every dental practice requires every policy above, and cover varies significantly between insurers.

Dentist Professional Indemnity vs Dental Practice Insurance

Registered dental practitioners are required to have appropriate Professional Indemnity Insurance arrangements when practising in Australia.

However, the Professional Indemnity arrangements protecting an individual dentist should not automatically be assumed to provide complete protection for the company or entity that owns the dental practice.

Some dentist Professional Indemnity policies may extend certain protection to a practice entity, particularly where the dentist owns and controls the business.

Other ownership structures, group practices or practices involving multiple independent dentists may require different arrangements.

The correct position depends on:

• the ownership of the practice;
• which practitioners work from the practice;
• whether dentists are employees or independent practitioners;
• the wording of the individual dentists’ Professional Indemnity policies;
• whether the practice entity is included within relevant definitions; and
• the services being provided.

We can review this alongside the remainder of the practice insurance program.

Does Your Dentist’s Professional Indemnity Protect the Practice Company?

This is an important question for practice owners.

Consider a dental practice operated through a company with several dentists working from the premises.

Each dentist may maintain their own Professional Indemnity insurance, but the business owner should still establish whether the practice entity itself is appropriately protected.

Potential allegations against a practice entity could involve areas such as:

• services provided by employees;
• actions of employed dental practitioners;
• actions of dental hygienists or oral health therapists;
• inadequate practice systems;
• supervision;
• infection-control procedures;
• equipment;
• administration; or
• vicarious liability for people providing dental services.

Whether separate entity cover is required depends on the existing insurance arrangements and practice structure.

Who Can We Assist?

Mercantile Insurance Brokers can assist with insurance for:

• general dental practices;
• privately owned dental clinics;
• multi-dentist practices;
• dental practice groups;
• multi-location dental businesses;
• orthodontic practices;
• periodontic practices;
• endodontic practices;
• prosthodontic practices;
• paediatric dental practices;
• cosmetic dental practices;
• oral health clinics; and
• other specialist dental practices.

The insurance program should reflect the actual procedures and services performed by the practice.

Dental Equipment Insurance

Dental practices can contain a significant concentration of specialist equipment.

Depending on the practice, this may include:

• dental chairs and treatment units;
• dental X-ray equipment;
• panoramic imaging equipment;
• CBCT equipment;
• intraoral scanners;
• CAD/CAM systems;
• milling machines;
• dental lasers;
• sterilisation equipment and autoclaves;
• compressors and suction systems;
• microscopes;
• laboratory equipment;
• computers and servers;
• 3D printers; and
• other specialist dental equipment.

These items can be expensive to replace and may also be critical to the practice’s ability to generate revenue.

Insurance values should therefore be based on realistic replacement costs rather than historical purchase prices.

Specialist Dental Fit-Out

The value of a dental practice is not limited to its equipment.

Dental premises can involve substantial investment in:

• plumbing;
• electrical infrastructure;
• cabinetry;
• specialist flooring;
• treatment rooms;
• lead shielding;
• sterilisation areas;
• reception areas;
• lighting;
• compressed air and suction systems; and
• other specialist fit-out.

Practice owners should consider the total cost of reinstating the premises following a serious insured event.

Where the premises are leased, it is also important to establish which parts of the fit-out are the responsibility of the tenant and which belong to the landlord.

Business Interruption Insurance for Dental Practices

Business Interruption can be one of the most important parts of a dental practice insurance program.

A serious fire, water damage or other insured property event could leave the practice unable to treat patients.

Even if the physical damage is repairable, reinstating a dental practice can take time.

The practice may need to:

• rebuild specialist treatment rooms;
• replace dental chairs;
• replace imaging equipment;
• reinstate plumbing and suction systems;
• replace computer systems;
• source specialist equipment;
• relocate temporarily; or
• wait for premises to become operational again.

During this period, revenue may reduce significantly while expenses continue.

Business Interruption insurance can potentially provide cover for insured loss of income and increased operating costs following insured property damage.

The indemnity period should be carefully considered rather than simply selecting a standard period.

Equipment Breakdown and Machinery Insurance

Not every significant loss involves a fire or major property event.

A breakdown of essential dental equipment can prevent a practice from operating normally even though there has been no substantial damage to the premises.

Equipment Breakdown insurance may be relevant for items including:

• compressors;
• suction equipment;
• sterilisation equipment;
• electronic equipment;
• air-conditioning;
• imaging equipment; and
• other insured machinery.

The relationship between Property, Equipment Breakdown and Business Interruption insurance should be considered carefully.

Dental Imaging Equipment

Dental practices increasingly rely on sophisticated digital imaging technology.

A practice may operate equipment such as:

• intraoral X-ray;
• OPG;
• CBCT;
• digital sensors; and
• imaging workstations.

When significant imaging equipment is installed, consideration should be given to its replacement value, breakdown exposure and impact on revenue if the equipment becomes unavailable.

The practice also needs to meet applicable regulatory requirements relating to the possession and use of radiation equipment.

Cyber Insurance for Dental Practices

Cyber risk is increasingly important for dental businesses.

Dental practices can hold significant amounts of sensitive information including:

• dental records;
• treatment histories;
• medical information;
• X-rays and diagnostic images;
• patient contact details;
• payment information;
• Medicare information where relevant;
• employee information; and
• appointment and billing records.

Practices may also rely on cloud-based practice-management software, imaging systems, online bookings, email, digital payment systems and third-party technology providers.

Cyber Insurance can potentially provide protection for events such as:

• ransomware;
• cyber attacks;
• privacy breaches;
• unauthorised access;
• data restoration;
• forensic investigation;
• incident response;
• notification costs;
• certain third-party claims; and
• business interruption following an insured cyber event.

The scope of cover varies between insurers.

Privacy Risks for Dental Practices

Dental practices are health service providers and handle sensitive health information.

Cyber risk therefore involves more than simply protecting computers from hackers.

A privacy incident could potentially result from:

• compromised email;
• stolen passwords;
• unauthorised access to patient records;
• ransomware;
• loss of a device;
• information being sent to the wrong person; or
• other unauthorised disclosure of patient information.

Cyber Insurance should be considered alongside the practice’s privacy procedures, IT security, backups and incident-response planning.

Public Liability Insurance

Public Liability covers different exposures from a dentist’s Professional Indemnity insurance.

For example, a patient or visitor suffering an injury because of a physical hazard at the dental premises may potentially involve Public Liability.

An allegation arising from dental treatment or professional services is a different exposure and may instead involve Professional Indemnity insurance.

The interaction between these policies should be understood so that the practice does not inadvertently rely on a policy containing a professional-services exclusion for a professional claim.

Dental Hygienists, Oral Health Therapists and Employees

Modern dental practices can involve a variety of healthcare professionals and employees, including:

• dentists;
• dental specialists;
• dental hygienists;
• oral health therapists;
• dental therapists;
• dental assistants;
• dental technicians;
• practice managers;
• receptionists; and
• other employees.

The insurance arrangements should reflect who works within the practice and the services they perform.

The policy treatment of employees and independent contractors should also be reviewed.

Independent Dentists and Contractors

Many dental practices involve practitioners who operate under contractor, service-fee or other independent arrangements.

Simply describing a dentist as an independent contractor does not determine how every insurance policy will respond.

Practice owners should understand:

• what Professional Indemnity insurance each practitioner maintains;
• whether contractual insurance requirements are being met;
• whether the practice entity has any potential vicarious liability;
• how the practice’s policies define employees and contractors; and
• whether any professional services are being provided directly by the practice entity.

Management Liability for Dental Practices

Practice owners and directors can face risks that have little to do with clinical treatment.

Depending on the policy, Management Liability insurance may provide protection for certain:

• directors and officers claims;
• employment practices claims;
• regulatory investigations;
• defence costs; and
• statutory liability exposures.

For larger dental groups, a standalone Directors & Officers Liability policy may be more appropriate.

Employment Practices Liability

Dental practices can employ a substantial number of people across clinical and administrative roles.

Employment disputes can potentially involve allegations relating to:

• unfair dismissal;
• discrimination;
• harassment;
• workplace conduct; and
• other employment-related matters.

Employment Practices Liability may be available as part of a Management Liability policy, subject to its terms, exclusions, excesses and limits.

Workers Compensation

Dental practices employing staff are subject to the applicable Workers Compensation requirements in their State or Territory.

Potential workplace exposures can include:

• repetitive movements;
• musculoskeletal injuries;
• slips and falls;
• manual handling;
• sharps injuries;
• workplace stress; and
• other occupational injuries.

Workers Compensation operates separately from the practice’s other business insurance policies.

Dental Practice Accreditation and Risk Management

Private dental practices can participate in voluntary practice accreditation against relevant Australian healthcare standards.

Accreditation and insurance perform different functions.

From an insurance perspective, strong risk-management systems may include:

• infection prevention and control;
• sterilisation procedures;
• equipment maintenance;
• clinical governance;
• staff training;
• incident management;
• patient records;
• privacy controls; and
• appropriate maintenance of the premises.

Insurance cannot replace these systems, but forms part of the broader risk-management framework of the business.

Multi-Location Dental Groups

Dental businesses with multiple practices create additional insurance considerations.

The insurance program should accurately capture:

• all insured companies;
• every practice location;
• property and fit-out values;
• dental equipment;
• practice revenue;
• practitioners;
• employees; and
• services performed at each location.

A group policy structure may sometimes provide advantages compared with arranging separate insurance independently for each practice.

Buying or Opening Another Dental Practice

Insurance should also be considered when a dental business acquires or establishes another practice.

Important considerations can include:

• adding the new legal entity;
• adding the new location;
• increasing property values;
• notifying additional activities;
• reviewing practitioner arrangements;
• adjusting Business Interruption values;
• increasing equipment sums insured; and
• reviewing Management Liability exposures.

Practice acquisitions should not simply be left until the next annual insurance renewal.

Claims-Made Insurance and Continuity

Dentist Professional Indemnity and certain Practice Entity or Management Liability policies are commonly written on a claims-made basis.

Continuity of insurance can therefore be important.

When changing insurers or restructuring cover, consideration should be given to:

• retroactive dates;
• previous claims;
• known circumstances;
• previous notifications;
• continuity provisions; and
• notification requirements.

Premium should not be considered in isolation where moving insurance could affect historical protection.

Why Use an Insurance Broker for Dental Practice Insurance?

Dental practices have risks that are different from an ordinary office or retail business.

Mercantile Insurance Brokers can review:

Your Practice Structure
We establish which companies, practice entities and locations need to be insured.

Your Existing Dentist Indemnity Arrangements
We consider how individual practitioner insurance interacts with the practice entity.

Your Property and Fit-Out
We consider the replacement value of specialist dental fit-out and contents.

Your Dental Equipment
We review high-value treatment, imaging, sterilisation and digital dental equipment.

Your Business Interruption Exposure
We consider what happens financially if the practice cannot operate following insured property damage.

Your Cyber Exposure
We consider sensitive patient information, dental records and reliance on technology.

Your Staff and Contractors
We consider employees, independent dentists and other dental professionals operating from the practice.

Your Management Exposures
We consider risks affecting practice owners, directors and management.

The objective is to build an insurance program around the dental practice as a whole, rather than treating the business as simply an extension of an individual dentist’s Professional Indemnity policy.

Dental Practice Insurance Australia

Mercantile Insurance Brokers can assist independent dental practices and dental groups throughout Australia.

We can assist with insurance for:

• single-location dental practices;
• multi-dentist practices;
• specialist dental practices;
• dental practice groups;
• multi-location dental businesses; and
• practices acquiring or establishing additional locations.

If you already have insurance, we can review the existing program to identify material gaps, restrictive exclusions, inadequate limits or areas where the cover may no longer reflect the current business.

Frequently Asked Questions About Dental Practice Insurance

What insurance does a dental practice need?

Depending on the business, a dental practice may require Property, Business Interruption, Equipment Breakdown, Public Liability, Cyber Insurance, Management Liability, Workers Compensation and appropriate Practice Entity Professional Indemnity or liability cover.

Does a dental practice need separate insurance if the dentists already have Professional Indemnity?

Possibly. Some dentist Professional Indemnity arrangements provide certain protection for an associated practice entity, while others may not adequately address every practice structure. The ownership of the practice, practitioners involved and policy wording should be reviewed before determining whether separate entity cover is required.

What is Practice Entity Professional Indemnity insurance?

Practice Entity Professional Indemnity or similar entity liability insurance can provide protection for certain professional liability claims made against the company or organisation operating the dental practice. The scope varies between insurers and should be considered alongside the Professional Indemnity insurance maintained by individual practitioners.

Can dental chairs and dental equipment be insured?

Yes. Dental chairs, treatment units, imaging systems, scanners, CAD/CAM equipment, sterilisation equipment and other dental equipment can generally be considered within the practice’s Property Insurance, subject to policy terms and limits.

Does dental practice insurance cover equipment breakdown?

Equipment Breakdown cover can potentially be arranged for specified electrical, electronic and mechanical equipment. The scope varies between insurers and should be specifically reviewed.

Why is Business Interruption important for a dental practice?

A dental practice can lose substantial revenue if property damage prevents it from treating patients. Business Interruption insurance may cover insured loss of income and additional operating costs following insured property damage.

Do dental practices need Cyber Insurance?

Cyber Insurance should be seriously considered. Dental practices hold sensitive health information and rely heavily on practice-management, imaging, booking, billing and communication systems.

Are independent contractor dentists automatically covered by the practice’s insurance?

No. Insurance arrangements differ considerably. The dentist’s own Professional Indemnity, contractual arrangements and the dental practice’s policies should all be considered.

Does Public Liability cover dental treatment?

Public Liability generally deals with different exposures from Professional Indemnity. Claims arising from professional dental treatment may be excluded from Public Liability and need to be considered under the relevant Professional Indemnity arrangements.

Can Mercantile insure a dental group with multiple practices?

Yes. A multi-location dental group can potentially be insured under a coordinated program covering the relevant entities, locations, equipment, property and other exposures.

Request a Dental Practice Insurance Review

If you own or operate a dental practice or dental group, contact Mercantile Insurance Brokers to discuss your insurance requirements.

You can retain your existing dentist Professional Indemnity arrangements and still ask us to review the insurance program protecting the dental practice itself.

We can review your existing policies or approach the insurance market for alternative terms.

Phone: 1300 310 467

Mercantile Insurance Brokers Pty Ltd
ABN 67 632 896 461
Authorised Representative of Community Broker Network Pty Ltd
ABN 60 096 916 184 | AFSL 233750