The deal 'will be aligned as far as possible' to the state-backed indemnity package due to take effect in England at the same time, Welsh health secretary Vaughan Gething has confirmed.
Wales has taken the decision to match the indemnity offer being rolled out in England amid concerns that soaring costs could drive GPs out of the profession, and because a less favourable deal on indemnity in Wales could undermine recruitment and cross-border NHS work.
Details of the indemnity model for England are expected to be unveiled this month. The government in England ran a survey of GPs earlier this year to build an 'up-to-date view of the GP indemnity market' to inform what the package should offer.
Mr Gething said: 'We have listened to GPs’ concerns. We understand the impact rising professional indemnity costs is having on the workforce and the potential for future pressure if different indemnity practices were in place in England and Wales.
'We’ve contributed towards the increasing indemnity costs through the annual uplift in GP pay and expenses since 2017, but today we are going further by responding to GPs' concerns with a long-term and sustainable solution.
'This further demonstrates our commitment to invest in primary care in Wales and attract more GPs to work in Wales, helping us to make sure our health service is sustainable in the long term.'
GPC Wales chair Dr Charlotte Jones said a state-backed deal was an 'important step' towards making general practice sustainable in Wales.
'It is reassuring to hear that the scheme will cover the wider practice clinical team, and will ensure that any vicarious liabilities GP partners have with the wider multi-disciplinary teams working across clusters is covered,' said Dr Jones.
'We look forward to working through the details with Welsh government who have clearly recognised the need for action on this complex issue.'
How the scheme will work will be defined in talks between the Welsh government, medical defence organisations and other in the coming months.
It will cover 'claims arising from clinical negligence for NHS work', but GPs will need to indemnify themselves for private work, complaints, coroner's cases, GMC hearings and some other aspects of their work.
Cover will extend to GP practice staff including salaried GPs, locums, practice pharmacists, practice nurses, healthcare assistants.
Medical Protection Society (MPS) chief executive Simon Kayll said: 'A state-backed indemnity scheme in Wales to protect GPs from the increased costs, will be welcome news to many. The fact that it will be aligned with the state-backed scheme announced for England, and rolled out at the same time, is also positive.
'The state-backed scheme will not however solve the underlying issue of rising clinical negligence costs. The cost of claims will always need to be paid for, and will continue to increase unless the root of the issue is tackled through legal reform.'
Medical Defence Union (MDU) chief executive Christine Tomkins said: 'Today’s announcement of a state-backed indemnity scheme for GPs and their staff in Wales comes not a moment too soon. With a similar scheme also due to be introduced in April 2019 for GPs in England, it is only fair that Welsh GPs benefit from same support with spiralling indemnity costs, which are not of their making.'