The digital world is fast paced and constantly evolving. Add healthcare into the mix and we’re seeing some amazing developments and technology to help improve our lives. However, when it comes to insurance for this very specialist sector, it can often be confusing with companies bringing together traditional healthcare with modern technology. This means that the risks that businesses operating in this area can be exposed to are truly unique.
The first step in risk management for any business is to understand the challenges you face. With a wealth of information available, there are many myths surrounding the insurance that is available and needed by companies operating in the digital healthcare sector.
Here we share some of the common misbeliefs and questions that arise which have been answered by CFC Underwriting, a specialist insurer to the science and technology sectors.
1. I don’t need to have my own insurance cover. I’m a sub-contractor for a large telemedicine company and they have their own insurance.
Although large telemedicine companies sometimes offer blanket cover for providers performing services on their behalf, as a provider or sub-contractor you should always make sure you’re covered, and that the insurer agrees to extend to the sub-contractor services. Some insurance providers see telemedicine services as a technology service only and would not extend to services provided online.
In addition, if you’re working for a larger organisation, you will probably have access to the company’s systems, data, and records. If you were to fall victim to a cyber-attack, such as a phishing scam that resulted a cyber breach this could encrypt the organisation’s whole system. It’s highly likely that you as a sub-contractor could be held liable for this breach. With the increase of working from home, cyber-attacks on individuals are becoming more common.
Make sure you are covered for any accidental breach of third-party systems.
2. We’re just a telemedicine platform. The providers listed on our website are responsible for their own insurance arrangements.
When offering health services via a platform, the platform act on behalf of the health services by offering access and facilitation of that service. This means there is a huge contingent exposure for the platform. If a claim occurred, the platform could potentially be named in the lawsuit for providing the patient with access to substandard care (if there is any subsequent negligence committed).
This could be because the platform failed to conduct background checks on the health service providers, or simply because the platform failed to ensure the service providers carried sufficient insurance. Telemedicine platforms should have defence costs to extract them from any legal action where the service provider(s) are found at fault or jointly at fault.
Insurance can provide contingent liability for providers performing services on behalf of the first name insured to protect an entity should an individual’s policy not respond for any reason. Does your insurance give you the cover you need?
3. We have our insurance cover provided by several different policies, each for a specific purpose. Why do we need specialist digital healthcare cover?
Historically, it’s been common for a business to have two or three policies due to a lack of an all-encompassing specialist product. However, having separate policies with different insurers can create gaps in cover when a claim occurs, especially where the underlying cause of a claim is ambiguous.
Typically, traditional policies would carry exclusions which would push the claim to another policy and potentially another insurer. For example, a medical malpractice policy would include a bodily injury exclusion from a cyber event, and a cyber policy would include a complete bodily injury exclusion or at best may offer a small sublimit.
This can lead to the business having to pay two excess amounts (if the claims are accepted), or in a worst-case scenario, leave the company exposed to the risk of the claim being denies.
Specialist insurance solutions for digital or E-health businesses bring everything together under one bespoke policy to ensure there are no gaps in cover.
4. My artificial intelligence software is a technology product, I don’t provide any healthcare services
The development and use of artificial intelligence (AI) is constantly evolving. Through aspects such as clinical triage, disease detection and chat bots, AI has the ability to increase the efficiency of the healthcare system.
However, AI is raising profound questions regarding medical responsibility. It’s easy to determine where the claim came from, i.e. human error, technology failure, cyber event but with AI, the line is extremely blurred.
Although AI can be considered a ‘technology product’, there is still a human component originating from the idea behind the AI. For example, the input of information, the ongoing accuracy reviews, as well as the end provider. Considering this, it’s extremely hard to pinpoint where the blame will lie, particularly with the lack of case law in the sector.
Insurance can provide affirmative bodily injury cover from multiple triggers, including professional / healthcare services, technology events and cyber, including ransomware.
5. Intellectual property is never included in standard insurance policies
With an unprecedented number of digital health companies entering the market every month, it’s becoming harder to create completely unique ideas, processes, and names to those already in existence.
Your business can still be accused of breaching intellectual property (IP) rights if an existing company alleges it’s too similar to their own – despite the belief that you’d created something unique.
Additionally, it’s very common for people from rival companies to be headhunted and employed to lean on for experience and expertise – but it can lead to legal complications. If a competitor feels the individual has the potential to bring over ideas or trade secrets obtained from their previous employer, this can potentially lead to an IP claim.
Typically, traditional insurance policies do not extend to IP claims. This is an issue for digital health (and other tech-based) companies and there are specialist insurance solutions that include IP cover as standard to protect your business against claims of this nature.
Risk management for digital healthcare – we speak your language
We’re here to help you understand the challenges your business faces and provide the right insurance and risk management solutions at the right time. We’ll help you build resilience and adapt to the ever-changing world as your business grows and develops.
Talk to us to find out more.