One example is the confluence of coverages in the medical device business. Professional Liability Insurance and Products Liability insurance have been discrete insurance products underwritten by different underwriters. Rapid change in technology is driving change in the delineation between products liability and professional liability for medical devices.
In some cases it is hard to draw the line between a medical product and a medical technology service, and for good reason. For some medical devices there should not be a line. This combination of exposures requires creative coverage solutions involving products liability and professional liability, and even Cyber Risk coverage. An account example:
Company X installs specialty equipment in physician offices which take patient readings. The readings are automatically transmitted to Company X for analysis by software and medical specialists, and the physician receives a customized report for the patient. Is this a product or a service? And is the necessary coverage professional or products? The answer – both. The solution – coverage combining both products & professional liability.
As software and medicine collide, the potential for major gaps in coverage, or inadvertently covered claims, presents a very real risk. Combine that with major jurisdictional differences in product liability law and it becomes clear that the insurance industry has some way to go to in order to keep pace with the innovation of the companies it insures.
Medical devices are not the only area where this confluence of coverage occurs. For example, we have provided customized coverage in the financial services area to a number of accounts with exposures encompassing:
- Technology E&O – for software licensing
- Professional services E&O – for the provision of professional services in conjunction with but different from the provision of software
- Cyber Risk coverage – for the storage and communication of confidential information
Tennant Risk Services is a specialty wholesale broker and underwriting manager, and delivers expertise, markets and exemplary services to our retail insurance agent clients in the placement of professional liability insurance (E&O, D&O, EPL, Cyber). We excel at hard to place accounts, including accounts involving both software E&O and products liability inherent in financial services, medical devices and other areas.