Product Liability responds to alleged Bodily Injury or Property Damage caused by "your product" or "your service".

While most Product Liability policies may have similar appearances in terms of limits of liability and deductibles, their insuring agreements can be quite different. Some of the most important policy provisions to consider in deciding which Product Liability policy is best suited for your exposure are:

• Coverage Trigger (does the policy respond to claims made against an insured during the policy period or claims made against and insured and reported to the insurer during the policy period?)
• Definition(s) of Who Is An Insured (determines which parties are covered under the policy)
• Exclusions (the circumstances under which the policy will not respond)
• Extended Reporting Period (establishes the time frame under which previously unreported claims can be reported to the insurer after the policy is cancelled).

All of these provisions are very important ones and their terms and conditions can vary greatly between insurance companies.

Because clinical trials offer unique, high-risk exposures, they require a properly constructed (and sometimes separate) liability policy specifically designed to cover clinical trials and provide maximum protection. The insurance covers the legal liability arising out of negligence resulting in the bodily injury or death of a trial subject. It is usually limited to specified trials of clearly identified products, and coverage must be tailored to meet the needs of the local competent authorities from each country in which a trial is conducted. Policies generally cover legal expenses and post trial liabilities for up to 60 months. It is important to note that all clinical trial policies are different and you must make certain that your policy is specifically written to cover all of your unique exposures.

• Contact the Ethics committee early enough to determine their requirements.
• Produce a protocol and Patient Information and Consent Form (PICF) in the local language, as well as English.
• Establish a local representative. Many times this function is assumed by the CRO.
• Work with a broker who understands the intricacies of international clinical trials, including when local, admitted insurance coverage is necessary.

Brokers can receive commissions direct from the insurance company quoting the risk, or they can negotiate a fee commensurate with their work which is negotiated with the insured at the inception of the policy, and then the policies are issued "net" of any commission. Britton-Gallagher believes no matter how you compensate your broker, you should always know what you are paying in broker compensation.

Contractual insurance requirements will vary depending on the type of contract. A typical supply agreement (where one party is supplying product to another party) will normally require the Seller to provide: Premises Liability, Worker's Compensation, Automobile Liability and Product Liability. It is our suggestion that the contract require the same type(s) and amount(s) of insurance be carried by the buyer as well. Clinical trial agreements (for the Sponsor, Site, PI or CRO) will normally have a requirement in them for Professional Liability/Error's and Omissions/Medical Malpractice. An important aspect to consider as respects to the language in the insurance requirement is that it should take into consideration that some or all of the insurance being required may be written on either a Claims Made or Claims Made and Reported basis. Many contracts do not make this distinction and it can lead to problems down the road should the contract be terminated.

All insurance companies are not the same. Some differences include:

• A.M. Best Rating – Their financial viability to pay claims.
• Financial Size – The ability to absorb losses and offer higher limits.
• Rating Structures – Each admitted carrier files its own rates with state regulators, and non-admitted carriers are free to set premiums where they deem appropriate.
• Forms – Each carrier has its own policy wording that they may vary significantly. Your particular operations and exposures will drive which forms offer the maximum coverage.
• Appetite – Carriers have underwriting strengths and are most comfortable and aggressive in certain industries.
• Ancillary Services – Some carriers offer loss control and loss prevention assistance to insureds.
• Claims Handling – Responses to claims vary greatly by carrier.

There is no definitive way to determine the precise amount of liability protection to purchase. Unlike Life Insurance where one can add up all known potential liabilities associated with one's finances to determine an appropriate amount of coverage, potential business liability exposures are so varied they make the process extremely difficult. There are a number of "indicators" that can be explored such as analyzing contractual obligations, benchmarking against other companies of similar size and operations, using insurance company claim experience within your industry group or reviewing closed claims. In the end, the decision boils down to your risk tolerance and ability to financially transfer some or all of the risk you face. As your company grows, it is important to continually review the limits you have in place to make certain they remain viable.

Companies operating with negative cash flow continue to have a business interruption exposure. The first is providing reimbursement of continuing expenses that continue during the period of restoration. The second is reimbursing lost funding due to the inability of the company to make milestone achievements which might earn them progress payments on arrangements they may have with funding sources.

First, it must be determined that there is a fit between our firms, and that it makes good business sense to pursue getting quotes from certain insurance companies. Next, a comprehensive risk analysis is performed on the business. Then the applications required by the insurance companies are completed, and all requested additional documentation is obtained. This could include protocols for clinical trials, informed consent documents, customer contracts, financial statements, or other needed information. All of this information is sent to the insurance companies who quote the risk. We then negotiate price and terms with the insurance companies, and present the results of the marketing to the insured for binding.

Many factors go into determining how much time will be needed, including the complexity of the program. The underwriter's workload is also a key element. In some instances, only a few days are required. In other situations, it could take several weeks. There is no standard amount of time.

A risk purchasing group is a legislative creation emanating out of the Risk Retention Act of 1981. It allows homogenous companies to come together and purchase general liability coverage on a group basis, when absent the RPG, they would not be combinable.

An RPG does not take risk. Rather, it is a vehicle for different companies to purchase on a group basis insurance from a carrier at discounted rates due to the group purchasing power and lower expense levels.

First we would need to agree that it makes sense to move forward with obtaining quotes. Once this is established, we would need applications for those lines of insurance you are seeking. Additional documentation may also be needed to adequately assess the risk, such as FDA documentation, study protocols, informed consent documents, customer contracts, financials, etc.

The timing behind the purchase of some forms of insurance may be driven by contractual requirements (lease agreements calling for Liability insurance on the Premises) or Clinical Trial site agreements calling for Product Liability or Professional Liability insurance. Then there are statutory requirements to take into consideration for Worker's Compensation and/or Disability insurance for employees. Do not overlook the importance of the "protection" you are purchasing in terms of the assets of the organization and those of the management of the organization. One of the more important and first purchased forms of insurance for a new company is Director's and Officers Liability insurance. It protects the owners, officers and directors (and their personal assets) from claims brought against them by third parties because of their actions/inactions in directing the company.

We represent over 200 separate insurance companies with a variety of appetites and areas of specialization.