AXIS Healthcare—the division of AXIS Insurance that provides professional liability insurance and associated standard casualty coverages for physician groups, hospitals, allied healthcare facilities and individual physicians—has launched a new medical catastrophe (contagion) business interruption product for hospitals. The coverage protects medical entities in the U.S. and Canada against a loss of revenue caused by the outbreak of a contagious disease.
The AXIS Healthcare Medical Catastrophe Business Interruption and Extra Expense product includes coverage for any disease that is transmitted by direct or indirect contact. These diseases include bubonic plague, MRSA, Legionnaires’ Disease, Middle East Respiratory Syndrome (MERS), Hantavirus, SARS, West Nile Virus, HIV, Ebola Virus, Marburg Virus, Lassa Fever, Influenza, and Bird Flu, as well as other lesser-known viruses or plagues. The new product would also provide coverage for diseases that have not yet been discovered by science, or a disease that could mutate into a pandemic at some point in the future.
Kimber Lantry, head of AXIS Healthcare said pandemics represent an especially serious risk for healthcare providers. During the 2003 SARS outbreak, hospitals were identified as the source of the spread of infection, resulting in the partial or complete shutdown of three hospitals in Canada. Additionally, Kimber added, after the first Ebola patient was admitted to Texas Presbyterian Hospital in October of 2014, the hospital lost $20.3 million in revenue over a two-month period, with a decline in inpatient days of 22 percent and a decline in ER visits of 49 percent during the first month.
The policy responds when the contagion directly results in any one of four triggers:
- A governmental quarantine of a hospital;
- If 25 percent or more of the medical personnel do not come to work;
- A 25 percent or more reduction in inpatient stays; or
- A 25 percent or more reduction in emergency room visits.
The maximum length of coverage is limited to twelve months from the date the coverage is triggered.
Prior to offering a quotation, a hospital must work with AXIS Healthcare on a pandemic preparedness assessment. The company will send, at its own expense, a healthcare risk manager with specialized skills in pandemic preparedness to assess the quality of the hospital’s pandemic program.
AXIS Capital is a Bermuda-based global provider of specialty lines insurance and treaty reinsurance.
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