Insurance Considerations for Global Clinical Trials

Excerpted from the Journal for Clinical Studies, September 2009.

As the number of trials being conducted in multiple countries continues to increase, sponsors must insure themselves against product liability issues that may arise. To be properly prepared, sponsors should develop an understanding of the insurance requirements of the countries in which they will be conducting trials.

United States and the Europe Union

In the United States, there are no government mandates for clinical trials liability insurance, but it is common for agreements between sponsors and testing sites, contract research organizations (CROs), researchers, and others to include requirements for insurance with defined policy limits. The EU, in contrast, has simplified what had evolved into a diverse set of insurance requirements among member states with a directive in 2001 that, among other things, requires insurance for clinical trials. As a result, most member states have issued their own laws to enforce this directive. Unfortunately, a single policy will probably not meet requirements of a multi-country trial since most countries, with the exception of the United Kingdom, require insurance to be written by an insurance company that is approved by regulators of the respective country. In addition, requirements vary in terms of limits and criteria regarding the type of policy. 

Emerging Regions

Insurance limits in emerging regions are usually lower than in developed countries. Accordingly, premiums are also lower. In addition, patients who experience bodily injury are less likely to sue the sponsor of the trial in emerging regions compared to patients in developed countries.

Since there are usually no or very low required limits, it is the job of the insurance specialist to assess the risks and to give advice regarding the appropriate limits of the insurance policy. It is risky to have limits that are too low (underinsured), as the sponsor may have a financial obligation to one or more injured test subject that exceeds the amount of insurance purchased. On the other hand, high limits and an expensive premium may not be necessary. An effective balance should be made after consulting with a clinical trial liability insurance specialist.

It is important for a company sponsoring clinical trials in naïve-population countries to become knowledgeable regarding all legal obligations, regulatory requirements, and restrictions, and to partner with people who possess this local knowledge. Insurance protection that meets the requirements of a specific country may leave coverage gaps in other jurisdictions. Because of this, sponsors of clinical trials are advised to verify jurisdiction limitations and obtain insurance which complements local insurance policies.

Finding a Partner

Clinical trial sponsors should not assume that the insurance broker who obtains general liability and business property insurance knows what to do and how to procure insurance which satisfies local requirements for clinical trials. Placing coverage using multiple insurance policies for individual trials conducted in several countries is quite complex. As such, executives responsible for managing clinical trials would be well served by an insurance specialist who focuses on the unique business and insurance/risk management needs of medical technology and life sciences companies conducting trials outside the U.S.

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