Clinical trial liability insurance has been around for more than two decades. But as the development and testing of new drugs has gone global, risks in the sector are growing and also becoming more nuanced, according to executives from two of the bigger carriers offering the coverage.

Executive Summary

Clinical trial liability insurance has been around for decades. But the increase in the number of trials—combined with anticipated changes in product delivery, regulation and market consolidation—will force carriers that offer the coverage to adapt, according to experts at Chubb and OneBeacon.

“The number of clinical trials is escalating,” said Frank Goudsmit, vice president, life sciences property and international manager at Chubb Group of Insurance Cos., perhaps the largest domestic life sciences underwriter. “As the pharmaceutical pipelines are drying up, [drug companies] are looking to replace revenue with new investigations of products.”

Two executives from OneBeacon Insurance Group’s technology insurance division—Todd Lauer, vice president of medical technology, and Jim Keenan, a medical technology underwriting consultant—say the coverage has evolved and become more sophisticated as regulatory and oversight demands have changed and increased. The pair said, for example, that coverage might now include medical malpractice for clinical investigators in addition to listing them as additional insureds, but the changing demands for the coverage go well beyond that.

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