Companies designing, prototyping, validating or developing medical devices before or during commercialisation.

Where the sector’s exposures differ

Bench testing, usability testing, clinical investigation and commercial supply are different development stages. A design error may create pure financial loss for a client; a device used on a participant can create injury exposure. Demonstrations and pilot supply also need clear disclosure.

Insurance covers to assess

Potential covers include design professional indemnity or errors and omissions, products liability for accepted prototypes or supply, clinical investigation liability where relevant, and property or transit insurance. Describe any collaborative work and testing activities so insurers can consider the proposed cover. Agreement terms and intellectual property rights belong with your legal adviser.

Policy features to discuss

We can discuss the insured activities, insured entities, territorial limits, defence costs, excesses and aggregate limits offered by insurers. If a customer requests particular insurance, let us know so we can consider the available cover. Legal interpretation, drafting and negotiation of contracts should be handled by your legal adviser.

An illustrative exposure

A developer supplies a prototype for evaluation and a client alleges an error in performance data. Use involving human participants would raise additional questions.

This is a hypothetical example to explain cover questions, not a Mercantile client case or a paid claim. The proposed policy must be assessed before assuming any response.

Information needed for a quotation

Intended purpose and users; development stage; test environments; human use; design versus manufacture roles; regulatory pathway; contracts and planned launch.

Also provide turnover, wages, subcontractor and labour-hire costs, the legal entities to insure, existing schedules and wordings, claims or known circumstances, and planned changes. A clear activity breakdown helps us approach suitable markets and compare the terms offered.

Common questions

Does prototype insurance carry through to commercial sales?

Not automatically. Changes in use, production volume, contracts and territories should be reviewed and accepted before launch.

Can Mercantile review existing insurance?

Yes. Send the schedule and wording together with a description of your activities and key contracts. We can examine significant gaps and approach suitable insurers, subject to their appetite and acceptance. We assist Australian businesses from our Norwest NSW office.

Related insurance sectors

Our service focuses on insurance placement and policy cover. Product classification, approvals and regulatory compliance are matters for your regulatory adviser or the relevant authority.

Return to medical research insurance or explore all Life Science insurance sectors.

• Global Clinical Trial Insurance
• Clinical Trial Drug Logistics Insurance
• Life Science Research Consultant Insurance

Prepared by Mercantile Insurance Brokers. Updated 30 September 2026. General information for Australian businesses. Availability and cover depend on insurer acceptance, policy terms, exclusions, limits and deductibles.