Press Release

Response to MDU Press Release

Micheál Martin TD, Minister for Health and Children, expressed surprise at the tone and content of a Press Release issued by the Medical Defence Union today. The MDU uniquely has been pressing the Government to relieve it of the bulk of its historic obstetric liabilities on the basis that it had not collected sufficient income from its Irish members to meet these costs. The MDU is the only indemnifier or insurer to take this position. In the absence of an agreement to take on these liabilities, the MDU has been threatening its own members that it will leave them high and dry if they are sued arising from events which occurred during years when they were paying the MDU five figure sums in subscriptions.

The Department has devoted enormous amounts of time to trying to resolve this problem with the MDU. Eleven meetings have taken place with the MDU since the beginning of February. Weeks were wasted while the MDU argued over the small print of confidentiality conditions which it sought to impose on the Department and its advisors. Eventually these were agreed.

The MDU accepted that three conditions had to be fulfilled before the Minister would even consider asking the Government to look at any agreement with the MDU:

  • Firstly, there would have to be an independent assessment of the MDU’s historic liabilities.
  • Secondly, the MDU would cooperate with a due diligence exercise to establish if the MDU had the financial resources to hold up its part of any agreement.
  • Thirdly, the Government would not agree to accept open-ended liabilities that properly belonged to the MDU.

The assessment of the MDU´s obstetric liabilities has now been concluded. However, even before the estimate of these had been given to the MDU they withdrew from the whole process and issued an ultimatum to the Government to the effect that if the Government did not accept an enormous proportion of their known and IBNR (incurred but not reported) liabilities by 12 May they would reactivate their threats to leave their own members without any cover. They also withdrew their agreement to the due diligence exercise. They have been offered a copy of the consulting actuaries report on their obstetric liabilities but have refused to accept it in accordance with the standard insurance industry terms on which such reports are made available.

The Government remains committed to trying to solve the MDU´s problems in a constructive fashion. Unfortunately this spirit has not been reciprocated by the MDU. The Government cannot and will not be dictated to by an indemnity organisation which has got itself into the plight that the MDU has. The Government still remains committed to trying to solve this problem in a reasonable way.