COVID vaccination: Pharma companies turn to insurance policies to cover 'adverse effects' liabilities

Vaccine manufacturers have ensured appropriate insurance cover for liability as India began its COVID-19 vaccination drive on January 16.

Ahead of the immunisation drive, most companies sought product liability policies to protect themselves, in addition to the clinical trial liability insurance taken during the vaccine trial phases, Business Standard reported.

Insurance companies on the other hand have approached the country’s largest reinsurer General Insurance Corporation (GIC Re) for support in provisioning product liability, the report said.

A source told the paper that New India Assurance and ICICI Lombard have “sought reinsurance support of $5 million against risk” from GIC Re. The request has been accepted, the source added.

Moneycontrol could not independently verify the report. The report noted that insurers have only transferred “some part of the risk,” while GIC Re has retained its entire risk without support from the international market.

The move towards ensuring insurance protection comes as the government clarified that drug manufacturers would be held liable for “adverse effects” arising due to their COVID-19 vaccine, same as with any other vaccine/drug. Pharma majors had requested the Centre to provide them indemnity from legal action related to the COVID-19 vaccine, and to hold liability in case of compensations.

Product liability can be called on in case of negative effects from the vaccine. Clinical trial liability insurance is a limited term policy protecting against legal liabilities that result from clinical trials – this ends when the vaccine goes into distribution.

Transit policy which provides pharma companies and traders insurance coverage for transport of the vaccines has also been accessed by firms.

Source: Money Control