Medical equipment manufacturers produce medical, surgical, ophthalmic and veterinary instruments and equipment such as the following:
- Hypodermic needles
- Anesthesia apparatus
- Blood transfusion equipment
- Surgical clamps
- Medical thermometers
Medical device manufacturers face very complex risks every day. What’s more, new risks emerge as research and technology change the game over and over again. To protect your assets and longevity in a life sciences field, you need customized insurance policies designed specifically for medical equipment manufacturers.
Some insurance companies specialize in insurance for the life sciences field. Working with an independent insurance agent, you can obtain quotes and evaluate coverage from reputable insurers who know your industry.
Medical equipment companies come in all sizes and manufacture a wide variety of equipment and devices. Regardless of the size of your business or the number of products you manufacture, you need a comprehensive business insurance program to protect you from the risks that are always looming.
You may work with delicate, expensive equipment, as well as fragile and even hazardous materials. Your equipment, as well as the materials and prototypes that you are working with, can be easily damaged.
Because you manufacture medical equipment, you are responsible for protecting your employees and the members of the public who ultimately use your devices.
Medical device manufacturers may also face supply shortages, equipment breakdowns and product recalls, as well as more typical property and liability risks faced by all businesses.
Every medical device manufacturer needs insurance policies that are tailored to their unique needs and the challenges that they face, including the following:
- Strict regulation
- Quality control concerns
- Supply chain interruption
- Patient injuries or harm during clinical trials
- Patient injuries resulting from your product
- Product recalls and spoilage
- Improper use of a product you manufacture
Product Coverage for Medical Equipment Manufacturers
Medical equipment manufacturers have significant and unique product liability exposures. You can be sued if one of your products causes harm because it is faulty, because someone uses it improperly or because you fail to provide proper warnings about potential dangers.
Product liability insurance, including completed products coverage, helps you pay for losses or injuries to a user, buyer or bystander caused by a defect or malfunction of any product that you manufacture.
Medical equipment manufacturers also need special coverage for patient injuries during clinical trials and for numerous other exposures unique to the life sciences industry. You need tailored product liability coverage that goes beyond industry standards.
An experienced, knowledgeable independent insurance agent can work with insurance companies that specialize in the life sciences industry and provide the type of coverage that you need.
You also have a significant product recall exposure. Product recalls can be financially devastating, even for large firms. Costs can include these:
- Product removal costs (pulling the product from the marketplace)
- Product disposal costs
- Costs to surgically remove implanted devices
- Product replacement costs
- Communications costs, including detailing the recall to the public and government agencies, as well as continued public relations costs
- Legal fees, settlements and judgments
Product recall insurance can help you with many of these costs and perhaps even keep you from declaring bankruptcy or going out of business. It reimburses you for recall costs whether or not you were negligent.
Other Coverage for Medical Equipment Manufacturers
Talk with your independent insurance agent about the following types of coverage for medical equipment manufacturers. Your policies should be customized for the unique needs of a life sciences company.
Commercial property insurance helps protect your manufacturing facilities, labs, offices and their contents — from office equipment to expensive, delicate machinery — in the event of fire, weather events, theft, vandalism and other covered perils. In addition, you may need various other types of property coverage:
- Commercial property insurance policies usually include business interruption coverage, or business income coverage, which protects your earnings if your business is unable to operate because of damage caused by some type of covered disruption (fire, hail, wind, equipment breakdown). This coverage is invaluable if you are forced to close your doors or relocate for a period of time in order to make repairs. It pays for rent, employee salaries, lost income, relocation fees and more.
- You can expand your business income policy to include coverage for breakdowns in utility services (water, electrical) that force you to temporarily close your doors.
- Boiler and machinery, or equipment breakdown, coverage helps you repair or replace damaged machinery that is essential to keeping your facility up and running. It also pays for lost income and other expenses related to the breakdown of covered equipment.
- Spoilage coverage offers financial protection for the costs of materials or finished products that spoil on site.
- Additional flood, windstorm or earthquake coverage may be necessary to protect your business property, depending upon your location.
- Inland marine insurance protects you from losses when cargo is damaged in transit. Any piece of property that is moved from one location to another can be covered with an inland marine policy. The best way to ensure that you find the right type of inland marine coverage for your needs is to work with an independent agent who has experience working with medical equipment manufacturers.
Commercial general liability (CGL) insurance provides broad liability protection for bodily injury and property damage to third parties caused by your negligence. You should also consider the following types of additional liability coverage:
- Environmental practices or pollution liability coverage protects companies from the costs associated with liability claims stemming from damage caused by hazardous waste materials.
- Employment practices liability insurance provides coverage for violations of antidiscrimination regulations. It protects a business owner if a current or former employee sues based on discriminatory employment practices.
- Commercial auto coverage is necessary if your business owns and operates any vehicles. It covers your vehicle fleet and drivers in the event of an accident or other vehicle damage that occurs as you transport your product from place to place using owned vehicles. It provides coverage for property damage and bodily injury liability claims, vehicle damage and medical bills, as well as any costs related to lawsuits due to auto accidents involving your vehicle fleet.
- Directors and officers (D&O) liability insurance provides protection for directors and officers of companies against legal judgments and costs arising from wrongful acts, erroneous investment decisions, failure to maintain property, releasing confidential information, hiring and firing decisions, conflicts of interest, gross negligence and errors of many other types. It is recommended for directors and officers who are accountable to investors, shareholders, creditors, employees and customers.
- Excess liability coverage, or commercial umbrella coverage, provides liability protection above and beyond the liability coverage included in a commercial general liability and business auto policy. A commercial umbrella policy pays when your other liability coverage has been exhausted.
Medical device manufacturers also need workers’ compensation insurance to protect employees from the costs associated with workplace injuries and illnesses.
Your employees may be exposed to dangerous substances or materials, as well as equipment or machinery that can cause injuries. Your independent insurance agent can help you purchase the workers’ compensation insurance required by your state.
How to Find the Best Medical Equipment Manufacturer Insurance
Insurance for any company in the life sciences industry is highly complex and requires the assistance and counsel of an experienced and knowledgeable independent insurance agent. Your agent can help ensure that you are not getting cookie-cutter coverage designed for a far less complicated business.
Contact an independent agent for tailored medical equipment manufacturing insurance advice and solutions.