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Insurance for Medical Devices & Equipment

Protect your medical device and equipment business with an insurance plan and dedicated risk management advisor. Scroll down to learn more about coverage, pricing, and the next steps.

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Medical Device and Equipment Insurance
What is a Medical Device Business?

Every day, doctors and patients find themselves in need of the right tools to treat injuries, illnesses, and chronic conditions. This presents a plethora of opportunities for companies that produce medical devices, with one report estimating the market to grow to more than $700 billion in the coming years. To keep your business safe, learn how medical device insurance can prevent tough losses in the future.

Business that develop, manufacture, or distribute medical equipment or technology are considered Medical Device Businesses, or just MedTech for short.

The industry is credited with saving millions of people each year due to the innovations across the medical industry. From orthopedics to diagnostic and medical imaging, the industry has solved countless problems for people.

The medical device industry is expected to grow to over $658 Billion by 2028, with the two largest sectors in wearable devices and artificial intelligence.

A significant amount of attention is on biotechnology and pharmaceutical parts of the industry, as the approval and testing process is often drawn out and tedious. Many small businesses recognize the opportunity for innovation in these sectors and have been producing some incredible ideas to further develop the industry.

As more people age and chronic diseases increase among our population, more businesses will start and more people will be saved.

What are potential risks?

As you run your medical device business, you could face several issues that are not uncommon in this type of industry. The development and use of medical devices are always evolving, so changes and retractions are expected. Many will not be directly the fault of your business, but they will still impact your operation if a product that is sold under your name has a problem.

Broken or Faulty Devices

One risk is the sale of a broken or faulty device. A device may fail because of a problem in the manufacturing process or due to an issue with some of the materials used. This is a good time to have medical device insurance so you can have protection against financial penalties and liabilities.

Devices could also fail to perform as expected if they are used in a situation they weren't tested for. This can happen if the development team failed to predict a possible application for the product they made. If the unexpected use is deemed to be reasonable, you may have to fight to prove that you are not liable for the device failure.

ADVISOR TIP: The most serious scenario is if a medical device leads to an injury or illness. In this case, it is extremely important to have meticulous documentation about how you tested a product, where you sourced materials from, who was responsible for manufacturing, and how the product was distributed. You will need all of these details to see which aspect of your medical device insurance will protect you.


Along the same lines, you may have to deal with recalls in the process of medical equipment manufacturing, retail, and distribution. Regulators are always looking at data on patient outcomes to make sure there aren't faulty products on the market that need to be pulled and revised.

Recalls can also apply to components of medical devices. For instance, you may get a notice that regulators have discovered some electrical wiring needs to be recalled because it presents a shock risk. If you used that material to make a hearing aid or blood pressure monitor, you will have to deal with the recall and address potential damages from users.

Address any recalls quickly and with extreme transparency to limit the risk to your business. These problems don't automatically damage your enterprise, but it could be damaging to wait to act on them in a way that could create more harm. By having the right combination of medical device insurance, you can feel confident that your business will be able to handle a recall or similar problem.

Worker Safety and Wellbeing

Medical device companies have a risk that exists for every business in every market: worker safety. Any operation that employs people to develop, build, or sell products needs to consider the risks that come with managing personnel. There is always a risk of human error or negative interactions that could impact the company.

Start with physical safety. From research and development to testing to assembly, medical equipment manufacturing, retail, and distribution workers are dealing with complicated machinery and tools that could lead to injury. Do you have a plan to support a worker who is hurt at your facility or while working on your company's behalf? If not, you face serious risk.

Cultural forces in the workplace can create risk as well. Issues such as harassment and discrimination can be detrimental to your company. If these types of allegations are made and any fault is found on the part of your company, your insurance policies can help with any settlement costs.

What insurance do they need?

With all of the risks you could face, you will likely need multiple types of insurance policies to fully protect your company. Some are standard practice for all businesses, while others offer specific benefits in the medical device manufacturing market sector.

General Liability

At the base of any insurance portfolio for any business is general liability insurance. This is sometimes also called just business insurance. This type of policy offers protection from third-party bodily injury and property damage costs. A third party would be anyone who is not the proprietor or an employee of a business, such as a visitor to your facility or a client.

You need to have this protection in place in case anything related to your business leads to someone getting hurt. If a person visiting your production area cuts themselves on your equipment, your general liability policy would cover the related medical costs so that you don't have to pay out of the company's account or your own pocket.

General liability also offers some protection for damages caused by your products, an important aspect of medical device insurance. The policy can cover legal expenses and judgments in case of a lawsuit.

Workers' Compensation and Employment Practices Liability

Any business that includes employees needs policies to protect that staff. If a worker gets hurt on the job, your general liability won't cover the expenses since your worker is not a third party. You will need a workers' compensation policy to deal with this. It will pay for your worker's medical bills as they recover from their injury and is often mandated by state regulators.

It is common to pair workers' compensation with employment practices liability. While you may do your best to make sure every worker is treated fairly and with respect, things go wrong sometimes. A person may perceive an inadvertent act of discrimination or you may have a worker who is disrupting the work environment without your knowledge. This is the coverage you need to handle these cases.

Commercial Property Insurance

When you manage a physical plant or office, get commercial property insurance. You invest a lot of money into your properties, whether they are manufacturing facilities or retail storefronts. Damage in these spaces can be expensive to repair and detrimental to your operations.

Your policy not only pays for fixes in the case of fires, weather events, vandalism, or other disasters but can cover the financial disruption to your company. A major incident at your factory may put your production and sales on hold. This type of coverage can provide funds to cover the loss of income until you get up and running again.

Product Liability

As a business owner looking for medical device insurance, you will want special coverage for your products. While general liability offers some protection for your products, you can take it a step further with product liability insurance. This is a policy designed to kick in if you are sued over the medical devices you make or distribute.

Because there is so much risk in the medical device field, it is a good idea to have this coverage for your business. While a general liability policy is tailored to cover things that happen to a third party at your business, product liability policies are meant to protect against issues that arise once a customer takes a product that you made or designed off the premises and is hurt.

Your product liability policy should also include additional coverage for recalls. You need medical device insurance that can address recalls, since they are not unusual in the medical device industry. You could face expenses such as the cost of replacing products or compensation for injury or inconvenience, and the right coverage can help ease the burden.

A thorough policy will compensate for potential design flaws or manufacturing issues with your products. Mistakes happen when you are innovating new medical devices to serve growing markets, so protect yourself in case something doesn't work out.

Errors and Omissions Insurance

Your list of medical device insurance should include errors and omissions insurance. This is an important policy to have when dealing with technology businesses, as it covers the advice and claims you make in regard to your business. Maybe you mistakenly gave inaccurate or lacking advice to doctors or healthcare providers about the capabilities of your medical device. You can get coverage for faulty knowledge.

Any problems that arise from information that you should have shared but didn't could be covered here as well. Errors and omissions insurance will also come into play in some copyright infringement claims, a situation you may face as you try to bring new medical devices to the market or begin selling your version of an existing product.

ADISOR TIP: By combining these different policies with other insurance coverages, you save money on annual premium and create a robust safety net for your company for years to come.

Insurance Quote Process

The process to get insurance for you medical device business is an easy and straightforward process. You get us the information we need to engage insurance providers and we'll supply the best possible quote(s). We're also real people that probably live in your city, and we value relationships, so meeting in person is always an option. At the end of the day, our job as brokers and advisors is to educate you on what everything means. It also helps us to understand your business and insurance needs, so we can get underwriter comfortable with quoting. We'll help you understand insurance and risk management practices, and be there for you as the business grows.

Some traditional businesses can move through the process faster as a lot of underwriting is supported by artificial intelligence, but most policies today will be reviewed by an actual person. We have decades of experience working with the underwriters at each insurance company, and pitch your business to each of them. We work with and for you.

The standard process to produce quotes for your business is as follows:

  1. Advisor Introduction: this can be a quick phone call, email, video conference or in person meeting. You'll decide if you enjoy the advisor and trust their advice. This is also where you'll be able to ask questions, provide information about your operation, and go over the process to get insured.
  2. Data Collection & Underwriting: this is where you'll get into the fine details about underwriting questions and information that will be necessary to engage the insurance market. You'll be able to chose from filling out PDF's, going through our smart-form technology, or provide it all over the phone, email, or in person.
  3. Quote Proposal & Review: once your advisor has the information needed for underwriting, they will work with the insurance market to produce quotes. This can take a day or up to a week, depending on the time and operation.
  4. Finalize Coverage: here you'll decide the coverage to move forward with. Final steps include signed documents, payment, and selecting a specific start date.

ADIVSOR TIP: Be prepared to spend 5-10 minutes with your advisor to break the ice and get the ball rolling. Once aligned, your advisor will create clear next steps and create a timeline for quotes. If your business is new, and has unique risks, then you should expect a little back and forth.

Get in touch with your advisor, or send over the details digitally today.


Why Fullsteam?

We’re humans, not robots.

We could have our algorithm give you a quote in 10 minutes. But your business deserves better than that. You deserve a dedicated insurance advisor and service team who knows how to manage complex risk.

We serve you, not the bank.

Your personal insurance advisor will negotiate the best coverage, at the best rate, from the best insurance carriers. Because anything less wouldn’t be acceptable.

Excellence is our middle name.

Think of us like your personal risk management concierge. The godparents to your business. Call, email, text, DM... we’re here whenever you need us.

We e-everything.

Paperwork is annoying. So we do business digitally. Life is just easier that way. Plus killing trees is mean.

Got questions? Give us a call.