Medical Device Manufacturing Specialisations: Manufacturing Insurance for UK Medical Device Manufact

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Medical Device Manufacturing Specialisations: Manufacturing Insurance for UK Medical Device Manufact

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Medical Device Manufacturing Specialisations: Manufacturing Insurance for UK Medical Device Manufacturers

Medical device manufacturing insurance: why it’s different

Medical device manufacturing is one of the most demanding production environments in the UK. It combines tight regulatory oversight, complex supply chains, precision engineering, strict quality control, and a level of product liability exposure that many other manufacturing sectors never face.

Whether you manufacture sterile single-use consumables, Class III implantable devices, diagnostic equipment, or connected medical technology, your insurance needs are shaped by your specialisation. The right manufacturing insurance programme can help protect your premises, machinery, stock, contracts, people, and reputation — and it can be the difference between a short disruption and a business-ending event.

Medical device manufacturers are exposed to a unique mix of risks:

  • Patient safety and product liability — even a minor defect can cause injury, trigger litigation, or lead to regulatory action.

  • Regulatory compliance pressure — documentation, traceability, and quality systems (often aligned to ISO 13485) are non-negotiable.

  • Recalls and field safety corrective actions — a recall can be costly even when no one is harmed.

  • High-value equipment and controlled environments — specialist machinery, calibration requirements, and cleanrooms increase repair and downtime costs.

  • Supply chain fragility — delays in components, sterile packaging, or raw materials can halt production.

  • Cyber and data risk — connected devices, remote monitoring, and digital manufacturing systems create new vulnerabilities.

  • Contractual risk — OEM agreements, hospital tenders, and distributor contracts can impose strict insurance requirements.

Because of these exposures, a standard “off-the-shelf” manufacturing policy often isn’t enough. A better approach is to build a tailored programme around your manufacturing specialisation, your regulatory environment, and how your product reaches end users.

Common medical device manufacturing specialisations (and how they change your risk profile)

Below are common specialisms in UK medical device manufacturing and the typical insurance implications. (Every insurer’s appetite and wording differs, so this is a guide to the themes you’ll usually see.)

1) Sterile single-use devices and consumables

Examples include syringes, cannulas, wound dressings, catheters, sterile packs, and disposable surgical items. These businesses often rely on cleanrooms, sterilisation processes, and validated packaging.

Key risk drivers:

  • Contamination risk and batch failures

  • Sterilisation validation errors

  • Packaging integrity failures leading to product spoilage

  • High-volume distribution increasing recall exposure

Insurance focus:

  • Product liability with appropriate limits and territories

  • Recall/withdrawal expenses (where available)

  • Property + business interruption (cleanroom fit-out and revalidation downtime)

  • Goods in transit and stock extensions (if shipping nationwide)

2) Implantable and Class III devices

Implantable devices (and other higher-risk classifications) can include orthopaedic implants, cardiovascular devices, and surgical implants. These products can carry long-tail liability exposure because claims may arise years after implantation.

Key risk drivers:

  • Severe injury exposure and high claim values

  • Long product lifecycle and traceability requirements

  • Complex materials and biocompatibility concerns

  • Heightened regulatory scrutiny and documentation demands

Insurance focus:

  • Higher product liability limits and careful jurisdiction/territory decisions

  • Strong quality and traceability narrative for underwriting

  • Consideration of recall cover and crisis management support

  • Contract review: indemnities, hold harmless clauses, and insurance requirements

3) Diagnostic equipment and IVD (in vitro diagnostics)

Diagnostic devices and IVD products may include lab analysers, test kits, imaging-related components, and diagnostic software. Errors can lead to misdiagnosis, delayed treatment, and reputational damage.

Key risk drivers:

  • Accuracy and performance allegations

  • Calibration and quality control failures

  • Software and data integrity issues

  • Supply chain dependency on specialist reagents/components

Insurance focus:

  • Product liability (and sometimes PI/design liability depending on your role)

  • Business interruption (downtime can break SLAs and hospital supply commitments)

  • Cyber cover if systems, software, or data are material to the product

4) Connected devices, software-driven devices, and digital health tech

Many modern devices include connectivity, apps, remote monitoring, or cloud-based services. This can blur the line between product liability, professional liability, and cyber risk.

Key risk drivers:

  • Cyber incidents impacting device performance or availability

  • Data breaches involving patient or clinical data

  • Software updates and version control issues

  • Reliance on third-party platforms and APIs

Insurance focus:

  • Cyber insurance (incident response, ransomware, business interruption extensions)

  • PI (if you provide advice, design, configuration, or software services)

  • Contractual liability awareness (SaaS terms, uptime commitments, limitation of liability)

5) Contract manufacturing and OEM production

Some manufacturers produce devices for other brands or operate as contract manufacturers. Your liability may depend on contract terms, quality responsibilities, and how branding and labelling are handled.

Key risk drivers:

  • Contractual liabilities and indemnities

  • Disputes over defect responsibility

  • Quality system obligations and audit requirements

  • Dependency on a small number of large clients

Insurance focus:

  • Clear split between “manufacture only” vs “design and manufacture”

  • Product liability aligned to your contractual responsibilities

  • Contingent business interruption considerations (if one client dominates turnover)

6) Precision engineering and component manufacturing

Some businesses manufacture parts rather than finished devices — for example, precision machined components, housings, valves, or specialist assemblies.

Key risk drivers:

  • Tight tolerances and high scrap costs

  • Downstream liability if a component failure causes harm

  • Quality assurance and traceability requirements

  • High-value machinery and tooling

Insurance focus:

  • Product liability (even if you don’t sell to the end user)

  • Machinery breakdown and engineering inspection

  • Stock and work-in-progress valuation accuracy

What “manufacturing insurance” typically includes for medical device businesses

UK medical device manufacturers often build their cover around a Commercial Combined (or Manufacturing Combined) policy, then add specialist covers depending on the product, distribution model, and contractual requirements.

Property insurance (buildings, contents, stock)

Property cover can protect your premises and business contents from insured events such as fire, flood, storm, theft, and escape of water (subject to policy terms).

For medical device manufacturing, sums insured often need extra attention:

  • Cleanroom fit-out can be expensive to replace and may need specific valuation.

  • Stock may include high-value components, sterile packaging, or temperature-sensitive items.

  • Specialist tooling and bespoke jigs can be costly and slow to replace.

Business interruption (BI)

If an insured event stops or reduces your trading, BI cover can help replace lost gross profit and contribute towards ongoing costs such as wages, rent, and finance commitments.

BI is often critical in this sector because:

  • Specialist machinery can have long lead times for repair or replacement

  • Cleanroom revalidation can delay restart

  • Customer approvals may be required before production resumes

A common mistake is choosing an indemnity period that’s too short. Medical device manufacturers often need longer recovery windows than general manufacturing.

Employers’ liability (EL)

If you employ staff in the UK, Employers’ Liability is typically a legal requirement. Manufacturing environments can involve manual handling, chemicals, machinery, and repetitive tasks — all of which can lead to injury claims.

Public liability (PL)

Public liability can cover injury or property damage claims from third parties arising from your business activities (for example, visitors to your site).

Product liability

Product liability is one of the most important covers for medical device manufacturers. It can respond if your product causes injury or property damage (subject to policy terms, conditions, and exclusions).

Key considerations include:

  • Territory and jurisdiction (UK only vs worldwide, including the USA/Canada)

  • Limits of indemnity appropriate for your device classification and distribution scale

  • Contractual requirements from hospitals, distributors, and OEM partners

Product recall / recall expenses

A recall can be triggered by contamination, mislabelling, packaging failure, performance issues, or regulatory action. Recall cover (where available) may help with costs such as notification, shipping, disposal, and crisis management.

Even if you never face a full recall, many manufacturers face “mini-withdrawals” or corrective actions that still cost time and money.

Professional indemnity (PI) and design liability

If you provide design, specification, consultancy, or technical advice — or if your product risk is tied to design performance — PI can be relevant. This is especially common for software-driven devices, diagnostics, and bespoke manufacturing.

Cyber insurance

Cyber cover is increasingly important for manufacturers using connected systems, cloud services, remote access, or handling sensitive data. It can help with costs related to data breaches, ransomware, business interruption from cyber events, and incident response (subject to policy terms).

Machinery breakdown / engineering inspection

Medical device manufacturing often depends on specialist equipment: CNC machines, injection moulding, sterilisation units, compressors, and calibration systems. Machinery breakdown cover can help with sudden and unforeseen equipment failure and may include associated business interruption extensions.

Directors’ and Officers’ (D&O) liability

As your business grows, D&O can help protect directors and officers against claims related to management decisions (for example, regulatory investigations, employment disputes, or shareholder claims), depending on the policy.

Underwriting: questions UK medical device manufacturers should be ready to answer

When arranging manufacturing insurance for a medical device business, insurers and brokers will typically ask detailed questions. Being prepared helps you secure more accurate terms and reduce the risk of gaps.

  • What devices or components do you manufacture, and what classifications apply?

  • Do you design the product, manufacture to a third-party design, or both?

  • Where are products sold (UK, EU, worldwide, USA/Canada)?

  • What quality standards do you follow (e.g., ISO 13485) and what testing/traceability systems are in place?

  • What is your batch control and recall process?

  • What is your annual turnover and split by product line?

  • What is your claims history?

  • Do you use subcontractors or outsource sterilisation/packaging?

  • What cyber controls do you have (MFA, backups, patching, access control)?

  • What contractual insurance requirements do your customers impose?

Practical risk management tips that also help your insurance

Insurers like to see strong risk control — and in a regulated sector, good risk management is also good business.

  • Documented quality management system with clear corrective and preventive actions (CAPA)

  • Supplier due diligence and contingency planning for critical components

  • Batch traceability and robust record keeping for faster, cleaner investigations

  • Environmental controls for cleanrooms and storage (temperature, humidity, filtration)

  • Maintenance and calibration schedules for key equipment

  • Cyber hygiene including MFA, offline backups, and restricted admin access

  • Clear product labelling and instructions to reduce misuse and claims

Choosing the right cover: what to prioritise

If you’re unsure where to start, focus on the covers that protect you from the biggest financial shocks:

  • Product liability aligned to your device type and distribution territories

  • Recall expenses if a recall would materially impact cashflow

  • Business interruption if downtime would threaten contracts or payroll

  • Machinery breakdown if you rely on specialist equipment

  • Cyber if your operations or products depend on connected systems

The “right” programme is the one that matches your real-world risk — not just the cheapest premium.

Talk to a broker who understands medical device manufacturing

If you manufacture medical devices or components in the UK, it’s worth speaking to a broker who understands the sector’s regulatory pressure, contractual requirements, and product liability exposure.

A tailored manufacturing insurance package can be built around your specialisation, your supply chain, and how your products are sold.

Call: 0330 127 2333Website: https://www.insure24.co.uk/

Important: This article is for general information only and does not constitute advice. Cover availability, limits, and exclusions vary by insurer and policy wording.

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