Marsh India, a global risk consultant and insurance broker, is working on an aggressive strategy to create a massive drive to expand the awareness of indemnity cover amongst all entities engaged in clinical trials. Most of the CROs and other establishments connected with the clinical research are currently outside insurance cover.
Being the first licensed foreign insurance broker in India, Marsh offers coverage that provides indemnity for any Adverse Drug Reactions (ADR), disease injury or death of the clinical trial subjects and damage to third party property from trial of drugs, devices or research procedures in accordance with the protocol.
Despite hectic clinical research activity in India, insurance coverage for the 120 clinical research organizations (CROs) is still at a nascent stage with only around five companies under the indemnity cover.
There is low awareness, serious lack of perception on the risks involved during the conduct of clinical trials, fatalistic attitude and reluctance to insure because its premium eats into the profit margins. "Our scope of awareness will cover areas like institutions, investigators and Institutional Ethics Committee. There is a poor understanding on the need for insurance cover for CROs,'' P Balasubramaniam, vice president, Technical, Marsh India Private Limited, told Pharmabiz in an email interview.
Marsh, ranked 207 in the Fortune 500 list, entered India last year and has offices in 110 countries to ensure no gaps in coverage/uninsured losses and attain premium savings based on global premium leverage. The company has a dedicated Life Science Practice with specialists working to advice on the risk issues, structure insurance solutions to meet specific requirements of the clients, customize covers and support insurers on reinsurance pricing.
Risks in clinical trials can arise from uninformed patient consent, failure to follow the protocol and negligence to comply with good clinical practices.
There is an impending need for an insurance cover going by the increasing number of trials and their complexities. This has led to a growing demand for appropriate risk management measures. The Clinical Trial Liability Insurance Regulatory authorities are tightening controls on ethical standards adopted and clinical trials processes in the wake of scores of mishaps occurring due to the negligence at the trial sites. Liabilities associated with trials can be major for both the CRO and the sponsor, explained Balasubramaniam.
According to industry sources, the premium to be paid for a policy depends on the indemnity chosen and number of subjects involved, type of trial, complexity of the trial, number of trials, total volume, track record, standardization of procedure-protocol and claims history. For a client with low risk exposure, it could work out to 0.75 per cent and high risk exposure could have a rate from 1.75 to 2.25 per cent with outright declinature for a bad risk. Capacity in India is also up to US$ 5million. For indemnity above $5 million, overseas reinsurance support is required.
Though there are other leading insurance providers globally with an offering for CROs like Chubb, CNA, ACE, Lexington, London and GenStar, Marsh is the first to realize the potential of the life sciences industry in India and has set up a dedicated team for risk management in this segment, said Balasubramaniam.