Victoria is set to lose and gain a medical indemnity insurer, with the forthcoming merger of market leaders United Medical Protection and the Medical Defence Association and the arrival of Invivo.

While the two merging companies are seeking approval for the move from the Federal Court this week, Invivo has signalled its intention to add Victorian market share to its NSW and Queensland holdings.

Invivo, which is partly owned by QBE, offers medical indemnity cover to doctors using a risk-based system, whereas its larger rivals calculate premiums by the number of patients seen.

The Victorian medical indemnity market is worth about $300 million a year.