Beazley examines digital health businesses’ insurance needs
A new report by Beazley Plc has taken a deep dive into the opportunity-rich world of digital health businesses, a majority of which, it turns out, are not adequately insured.
The Spotlight on digital health and wellness 2022 report was based on a Beazley-commissioned survey of 300 digital health and wellness industry business leaders from the UK, the US, Canada, and Asia (Singapore and Hong Kong). The poll spanned health and wellness practitioners; software and platform providers; health-technology and life sciences technology companies; and mHealth (mobile health), telehealth, and telemedicine providers.
Of the global respondents, it was found that 76% do not have a single insurance policy tailored to the risks they face, even while 99% of the firms surveyed plan to expand and 72% noted growth in demand. Business leaders acknowledged cyber and regulatory as the top risks.
Here are some of the findings:
24% have a single industry-tailored policy that covers them for nearly or everything
34% have a number of separate insurance policies, some or all of which are industry-tailored
33% have a single policy that covers for everything or almost everything but is not tailored
9% have a number of separate policies, none of which are tailored to their industry
62% do not have coverage for technology errors or omissions leading to bodily injury
69% are not covered for medical malpractice due to incorrect data leading to bodily injury
37% are covered for bodily injury due to remote care
“In our experience, the largest cause of loss continues to be allegations of medical negligence or medical malpractice,” said Beazley’s Keri Marmorek, claims focus group leader for miscellaneous medical & life sciences. “Mostly these are traditional-type claims, but now a growing number stem from patient use of a medical platform or app.”
Meanwhile, below are the top risks for digital health and wellness businesses globally.
Risks
UK
US
Canada
Asia
Meeting regulatory requirements
24%
8%
13%
27%
Regulatory or historical restrictions limiting growth
16%
19%
20%
17%
Economic uncertainty
17%
17%
13%
21%
Supply chain and manufacturing instability
17%
20%
20%
9%
Meeting a minimum financial performance
17%
12%
17%
16%
Ability to recruit, retain, and check credentials of practitioners
16%
15%
16%
16%
Billing errors for contract business
16%
13%
17%
13%
Inflation
13%
13%
19%
11%
Inability to secure investment
12%
17%
9%
13%
Coping with pace of growth
12%
15%
9%
11%
Staying up to date with regulatory requirements
13%
11%
12%
9%
Competition
5%
12%
7%
13%
Evan Smith, global head of miscellaneous medical and life sciences at Beazley, stated: “As opportunities abound and economic imperatives force faster innovation to drive profitability, the insurance needs of the health and wellness sector will inevitably become more complex.
“Investment in cyber defences plus broader risk and crisis management are all strategies identified by digital health businesses to sustain growth in 2022. Such developments, while essential to the future of the digital health and wellness industry, will add further pressure on the insurance industry to adapt and evolve new coverages.”
For Jennifer Schoenthal, global product leader of virtual care, the insurance industry needs to continue to stay connected to business leaders’ concerns and work closely with clients as their businesses grow and digital health models move forward.
