Unforeseen Loss

When a fire broke out at the Community Midwives of Halton clinic, midwife Wendy Murko called the practice’s business insurer (the Healthcare Insurance Reciprocal of Canada (HIROC)), to assess the damage. Although the sprinkler system put the fire out quickly, the clinic and surrounding offices suffered extensive smoke and water damage. The fire, which resulted from a faulty kettle that had been left plugged in, caused considerable loss, including loss of all medications and home birth supplies, furniture, and communication systems (e.g., email, telephone, fax).

The costs quickly added up: demolition and reconstruction; extensive cleaning; the replacement of equipment, supplies and medication; alternate office space rental; and staff overtime.

 

The cost of cleanup alone was more than half of the practice’s insurance coverage, and the total cost (which did not include some of the lasting losses) easily reached the limits of the business insurance coverage. The partners bore the responsibility of paying the deductible and expenses that exceeded the coverage limit of their policy.

When asked what lessons they would share with other midwives, Murko, HIROC and the insurance adjustor, Jeff Shurtleff, agreed: midwives need to look closely at the amount of coverage they have and speak with their insurer about their individual needs.

It is important to look beyond the cost of office contents and ask whether liability coverage is adequate and if the policy includes insurance to cover tenants’ improvements in the building (e.g., walls, floors and kitchens); the cost to rebuild the space (e.g., demolition, reconstruction and renting alternative space); and the cost of replacing equipment and supplies.

Murko says the experience also highlighted the importance of putting way sensitive documents, such as client charts. Fortunately, in this instance, all client charts were safely stored. She also learned the importance of having emergency contact information and insurance policies accessible in the event of a loss.