Institutional Pharmacy Store Insurance

Finding the Best Institutional Pharmacy Store Insurance

(Just because you're inside a larger retail store doesn't mean you're protected by them.)

Institutional Pharmacy Insurance

Unlike retail pharmacies, institutional pharmacies are located inside hospitals, health centers, and other facilities and only serve the needs of the patients of that center.

When it comes to insurance, this mixes things up a bit for institutional pharmacies. Fortunately, an independent insurance agent can make sure your business is fully covered, including your pharmacy.

What Are the Risks of an Institutional Pharmacy?

The risks that an institutional pharmacy faces are the same as a retail pharmacy.

  • A patient has a bad reaction to a prescribed drug and blames the pharmacist.
  • A pharmacist mislabels a prescription bottle, resulting in an injured or ill patient.
  • An electrical failure causes drugs to spoil.
  • An employee is caught stealing prescriptions, resulting in income loss.

The biggest concern for an institutional pharmacy is making sure that the business insurance obtained by the facility owner is extensive enough to include the specialty insurance needs of a pharmacy.

Does an Institutional Pharmacy Need Property Coverage?

Even though an institutional pharmacy is tucked inside a business, it’s still housed inside a building. It also still has products, considered property. It’s important to make sure that the owner of the facility where the pharmacy is located has the proper coverage that includes potential damage and income loss from the pharmacy. This could include the following insurance policies: 

  • Contents insurance: This covers the property kept inside your pharmacy from loss or damage caused by covered events such as fire, storms, theft or vandalism.
  • Spoilage insurance: This provides compensation for medications that require refrigeration if an extended power outage renders them unusable.
  • Equipment breakdown insurance: Also known as boiler and machinery coverage, this provides compensation if the equipment in your store, such as heating or cooling systems, or the computer system, goes down and causes you to lose business while you are unable to remain open.
  • Building insurance: If you own the building in which your pharmacy is housed, this provides coverage for damage to its structure.

Why Your Institutional Pharmacy Needs Liability Coverage

Distributing medicine comes with major risks. Supplying the wrong dosage, mislabeling, or misinforming patients can lead to catastrophic health problems for them. This can result in hefty lawsuits that you don’t want to be on the other side of without proper protection.

Even though an institutional pharmacy is serving a facility, you still need the following liability protections.

  • Druggist liability insurance: This is a form of professional liability insurance designed to protect your business from lawsuits brought on by pharmacist errors. This can include mislabeled pill bottles, inaccurate customer consultations, failure to notice a drug interaction, or other problems unique to pharmacies.
  • Premises liability insurance: This protects your pharmacy if a third party suffers property damage or injury while in your place of business.
  • Product liability insurance: If your pharmacy sells a faulty product that causes illness or injury to a third party, your business may be named as a defendant in a liability lawsuit. This provides coverage for this type of situation.
  • Auto liability insurance: If your pharmacy offers drug delivery services, you will need the proper auto liability coverage. For company-owned vehicles, you will need a commercial auto policy. For personally owned vehicles, you will need hired or non-owned vehicle liability coverage.
  • Cyber liability insurance: Your pharmacy probably keeps confidential patient records in a computer system. If that computer system is hacked and the information is leaked, your business may be sued by those affected. Similarly, hackers may steal credit card and insurance information, and this can cause your business legal troubles as well. Cyber liability insurance provides coverage for this type of situation.

What Other Insurance Options Should an Institutional Pharmacy Consider?

Property and liability coverage are crucial for all businesses, but pharmacies can benefit from some additional insurance coverage. You can discuss the following options with your independent insurance agent to see if they’re a good fit for you.

  • Business income insurance: If an unforeseen event, such as a fire, forces you to close your pharmacy, this coverage provides income until your business can resume normal operations.
  • Workers’ compensation insurance: Workers’ compensation is required in every state besides Texas. This insurance provides coverage for medical bills associated with employee injuries sustained on the job. It also protects you from liability lawsuits.
  • Flood insurance: Commercial insurance policies exclude coverage for losses sustained due to floods. To get this protection, you will need to add a commercial flood insurance policy to your portfolio.
  • Employment practices liability insurance: This insurance provides coverage in the event that one of your employees sues your pharmacy for breach of contract, wrongful termination, discrimination or any other illegal business practice.
  • Employee dishonesty insurance: This insurance protects your pharmacy from financial losses in the event that one of your employees steals from your business or engages in other illegal practices while on the job.
  • Health insurance: If your business has at least 50 full-time employees, you are required to provide them with affordable health insurance. Your insurance agent can help you find suitable coverage.
  • Employment practices liability insurance: Also known as EPLI, this insurance provides coverage for your legal defense and potential financial damages if one of your employees sues your business for an illegal business practice such as sexual harassment, discrimination or wrongful termination.

How Much Does Institutional Pharmacy Store Insurance Cost?

The cost of insurance coverage for your institutional pharmacy store will depend on a number of factors. These include:

  • The size of your pharmacy
  • The location of your pharmacy
  • If you offer additional services like delivery
  • The value of your inventory and other business property
  • The number of workers you employ
  • The types of business insurance coverage you are purchasing
  • How high you need your coverage limits to be
  • Your store’s claims history

A local independent insurance agent can obtain a variety of customized quotes on your behalf. That way, you can be sure that the policies you select are offered to you at a reasonable price.

How to Find the Best Insurance for Your Institutional Pharmacy

Insurance policies can be complex, and searching through options can be confusing, time-consuming and frustrating. An independent insurance agent's role is to simplify the process.

When it comes time to purchase insurance, they’ll break down all the jargon and explain the details, so you understand exactly what you're getting.

And should you need to file a claim, you’re not alone. Your agent will be right there to help guide you through every last step and get your life back to where it all was. How great is that?

Why Online Quotes Aren’t Always the Best Way to Shop

Getting your insurance quotes online can be tempting. Sure, it’s fast and easy. But are the quotes you are getting actually accurate? And are you getting quotes for all the different types of coverage your business needs?

Online quotes cannot give you the whole picture. They often leave out important coverage, which may result in you being unable to get compensation if something disastrous happens. And they can leave out cost-saving opportunities such as discounts and bundling opportunities that an independent agent can help you take advantage of. 

Instead of getting an online quote, find an independent insurance agent near you, and schedule a one-on-one consultation to discuss your options for the best coverage for your particular pharmacy. 

Benefits of an Independent Insurance Agent

Independent insurance agents have access to multiple insurance companies, ultimately finding you the best coverage, accessibility and competitive pricing while working for you. Find an independent insurance agent in your community here.

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TrustedChoice.com Article | Reviewed by Paul Martin

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