Medical device manufacturing insurance – US/Canada exports
Product liability insurance for medical device distributors and manufacturers is a must have but it can be very expensive especially if you are selling into the US/Canada market.
The increased litigious nature of the North American market and the propensity for larger losses coupled with the nature of the product i.e a medical device; means that the availability of product liability insurance at an affordable level can be limited.
Insurers react in different ways but depending on the type of product, volume of sales and whether you are a distributor or manufacturer will mean that an Insurer will either provide full cover or:-
- Decline to offer cover.
- Provide cover at a reduced limit of indemnity.
- Increase your excess.
Where an Insurer is happy to provide either partial or full cover there will almost certainly be a premium loading.
This is a far from satisfactory situation however there are ways to mitigate this problem. It is important to ensure that your broker or Insurers are aware of the ways in which you mitigate the risk of product liability claims eg provide details of any quality accreditations, copy of internal quality control guidelines etc.
If you are only distributing products then providing full details of the manufacturer and clarification of your contractual relationship will help to reduce the potential costs for the insurance.
It is also important to find the right Insurer. There some Insurers that are perfectly happy to provide cover and whilst there will a premium loading it will be more palatable. Importantly these Insurers will be more than happy to provide free risk management advice related to North American sales to help identify potential problems before they occur.
As experienced brokers in the medical device market ADF Insurance are able to arrange product liability for medical device manufacturers that sell into the US/Canada market. For more details please do not hesitate to contact me.