Insuring Clinical Trials 101

Your company is about to embark on a clinical trial.   Insuring this exposure is unique and a bit more complex than your typical insurance.  The following provides three high level items you need to obtain a quote and place coverage, followed by a question and answer section to help you gain an introductory level understanding:

1.      The Trial Protocol – Most insurers will give you an indication of the cost to insure a trial with a preliminary protocol, but they will need to review the final protocol before putting the policy in force (often referred to as a subjectivity to the quote).

2.      Informed Consent Form (ICF) – Insurers will want the ICF to be written to an elementary reading level (8th grade education is the norm) with a thorough explanation of all the things that could possibly go wrong.

3.      Investigator’s Brochure (if available) – A comprehensive document summarizing the body of information about an investigational product obtained during preliminary research on a drug.

Those items will help your broker obtain an indication for you, but you may need to complete the insurer’s application before putting a policy in force.

The following are some of the more common clinical trial insurance questions and answers:

Question:         Does my general liability or umbrella liability insurance cover clinical trials?

Answer:           No

Question:         What happens if there are amendments to the protocol during the trial?

Answer:           Any changes in protocol should be communicated with the insurer.  Some insurers may exclude coverage if they are not informed of changes, so it is always a best practice to inform your broker of protocol changes.

Question:         What happens if we increase the number of participants from the time a quote was provided?

Answer:           Insurers may have a “per participant” charge depending on how the quote is developed.  An increase in participants could result in additional premium owed when the policy audit occurs.  These changes are good to communicate with the broker and insurer as they occur to prevent unexpected premium owed.

Question:        Does the cost of insurance differ if the trial takes place in the United States versus another country?

Answer:           Yes.  The United States is typically the most litigious country and thus premiums are typically more expensive for trails conducted domestically.

Question:        If the trial takes place in a foreign country are there any special insurance considerations?

Answer:           Yes.  Your broker will need to identify if the country of choice requires “admitted” coverage.  This can typically be identified by an experienced broker very quickly.

Question:        If I conduct the trial in a country that requires local, admitted coverage is there any other policy that will be needed?

Answer:           Yes.  The local, “admitted” policy provides coverage in that country(ies) only.  Companies conducting clinical trials in foreign countries should always consider purchasing a “global” policy that responds to suits brought in the United States or outside of the country where the trial was conducted.

Question:         What limits of liability do I need?

Answer:           It depends on a number of factors.  The contract research organization (CRO), clinic or investigators may have specific limits they want to see.  Your own company’s risk appetite is also another consideration to factor.  Your insurance broker will be able to provide you a number of options depending on your needs.

Question:        Do my vendors (CRO, clinics, healthcare providers and investigators) need their own insurance?

Answer:           Yes, they should have their own professional liability insurance since most clinical trial product liability insurance policies exclude medical professional liability.  That said, most clinical trial insurers will allow additional insured status automatically for these partners for the product liability so long as there is a valid written contract requiring your company to do so.

Question:           What insurance companies are capable of properly insuring clinical trials?

Answer:              There are several quality insurers that are capable of handling this exposure such as Chubb (ACE), Medmarc, CNA, Travelers and Berkley.  The difference will depend on the exposure, coverage limits and international capabilities.

You should always get a legal review of the agreement between your company and your vendors.  Your insurance broker cannot provide a legal opinion, but an experienced broker should be able to advise whether your insurance coverage meets your contracts requirements.