Insurance Industry

UNDERWRITING BIOLOGICAL RISKS IN MEDICAL AND LABORATORY FACILITIES

The 278,000 hospitals and medical facilities, blood banks, and testing laboratories across the US are not without substantial risks from biological pathogens. Research laboratories, representing approximately 12,500 locations in the United States, including government laboratories, universities, drug companies, and other private laboratories account for another widespread block of potential customers. These risks may already be on your books in the form of general liability, errors and omissions, workman’s compensation, and real estate coverages.

BIOLOGICAL RISKS ARE A REAL AND IMMEDIATE CONCERN.

According to the US Centers for Disease Control, Clostridium difficile, Staphylococcus Aureus and Klebsiella pneumoniae are the most prevalent hospital acquired pathogens. That’s not the end of the story. According to the US Department of Health and Human Services (HSS) hospital acquired infections are among the leading causes of preventable deaths in the US and are associated with a substantial increase in health costs each year. But wait … it gets worse. Methicillin-resistant Staphylococcus Aureus (MRSA) and other drug resistant “superbug” infections make the headlines on a weekly basis because they’re at near epidemic levels in US hospitals. The US Centers for Disease Control identify the following 18 increasingly drug resistant “superbugs” as “urgent, serious and concerning threats” to mankind. All are becoming increasingly prevalent at alarming rates.

Carbapenem-resistant Enterobacteriaceae (CRE)
Drug-resistant Neisseria gonorrhoeae
Multidrug-resistant Acinetobacter
Drug-resistant Campylobacter
Fluconazole-resistant Candida
Extended spectrum beta-lactamase producing Enterobacteriaceae (ESBLs)
Vancomycin-resistant Enterococcus (VRE)
Multidrug-resistant Pseudomonas aeruginosa
Drug-resistant non-typhoidal Salmonella and Salmonella Typhi
Drug-resistant Shigella
Clostridium Difficile
Methicillin-resistant and Vancomycin-resistant Staphylococcus Aureus (MRSA and VRSA)
Drug-resistant Streptococcus pneumonia
Extensively drug-resistant tuberculosis (XDR TB)
Erythromycin-resistant Group A and Clindamycin-resistant Group B Streptococcus

Hospitals are a significant cause of the spread of lethal infections. One in 25 patients admitted to the hospital will contract a hospital-acquired nosocomial infection and about 10% will die from it. Drug resistant tuberculosis now forms an alarming proportion of all tuberculosis cases according to the World Health Organization. Even worse, novel pathogens, including those that cause Ebola, Dengue Fever, Marburg, Zika and Shigellosis are being introduced into the United States through commercial travel and immigration from low resource countries.

The problem isn’t limited to the healthcare environment. Government, university and bioscience companies working with Select Agents (anthrax, small pox, and other deadly pathogens) have been the subject of a series of reports in USA Today documenting accidental releases and mishandling of these organisms in BSL-3 and BSL-4 containment laboratories.

Specific underwriting of biological risks is in its infancy, with many locations not having a biosafety expert on staff, or even appropriate protocols for biosafety, biosecurity or waste management. Staff training is minimized in the name of cost control. With potential liabilities that can quickly reach most insureds’ policy limits, how can such biorisks be underwritten while containing claims costs? Are you able to accurately assess your client’s biological risk, and set suitable policy limits and premiums for the standard underwriting risks associated with their facilities for proper insurance coverage?

BIORISK MANAGEMENT – THE SOLUTION TO CONTROLLING CLAIMS COSTS.

Just as a loss control inspector routinely suggests or requires changes to real property and other operational risks prior to the underwriting of insurance, biological risk can be controlled by better management. You, as the insurer are in a unique position to require biosafety reviews and program analysis and to require potential insureds to implement, manage, and maintain safety protocols and staff training programs.

You can’t afford to be out of the market for this large and diverse group of clients. You can afford to approach this market on an enlightened basis, however. It is in your best interest to require all laboratory and medical facilities to adopt and maintain a Biorisk Management Program created by a qualified biosafety professional. The risk of increased loss ratios will decrease significantly when your clients adopt, implement, and maintain proper biorisk management procedures and safety protocols.

THE BIORISK MANAGEMENT SOLUTION.

If you are concerned that any of your laboratory, medical, or real estate clients who rent to tenants with biological exposures with these types of biosafety risks, please contact us immediately. We welcome the opportunity to have a conversation to help identify any potential risks and propose a customized solution.

Underwriters can immediately benefit from our support in the following areas:

BioRisk Management Program Review
Institutional Needs Assessments, Safety Audits and Risk Assessments
Review of Administrative Controls, Program Plans, SOP’s and Training Content
Our BioRisk Management Professionals are Available to Assist Your Clients with Their Specific Needs

We also offer these valuable related services:

Select Agent Program Application Pre-Inspection
Facility Design Review for New and Existing Facilities
BSL-3 Verification
Decommissioning of Laboratory Spaces

BioRisk. Managed. ^TM