Insight into Miscellaneous Medical & Life Sciences - Claims in Canada

In this second part of our two-part interview with our Miscellaneous Medical and Life Sciences team (MMLS) we catch up with Krystyna Kouri and her claims colleagues. Krystyna recently joined Beazley and is responsible for healthcare claims in Canada. She is joined by Jessica Schappell, who is based in Singapore and Andrew Lovell, who heads up our rest-of-world Healthcare claims team. 

Read the first part of this series with our MMLS Underwriting Team here. 

Tell us a little about yourself: How long have you handled Miscellaneous Medical and Life Sciences claims? What did you do prior to joining Beazley? How would you describe your experience to date?

Andrew Lovell: I head up our rest of world healthcare claims team which has responsibility for claims from all territories outside of the US and have been with Beazley about 3 years. 

I started as a lawyer in healthcare responding to regulatory claims and doing med mal defence claims. Shortly after I moved to Hong Kong and qualified there, primarily advising healthcare clients on regulatory regimes and doing some medical defence work. I then moved back to London where I joined Beazley. 

Moving to the insurance industry has been a steep learning curve as I have had to take a more strategic view looking at how the book is performing, not to mention the broader geographic scope we have responsibility for. We handle claims in 39 different countries!

Jessica Schappell: I moved to Singapore from our New York office about 3 years ago to support our underwriters here. I’ve been with Beazley since I joined as a claims assistant in 2007 and been managing healthcare claims for the last 8 years. 

Krystyna Kouri: I recently joined Beazley to head up claims here in Canada. Prior to joining I worked for a Lloyd’s TPA, and before that I was a senior claims counsel at a large north American insurer. I’m a lawyer by training and started in healthcare claims after being called to the bar in 2003.     

What are the advantages to an insured of having cover which has been specifically designed to meet their needs?

AL: No two insureds are the same and this is a varied industry, depending on what they do will dictate what cover they need. For example, a clinical trial will need medical malpractice cover but may also need non fault cover for bodily injury which is a requirement in many territories. 

JS: If you work with an insurer who understands the industry it gives more certainty to clients. An insured might purchase various of off the shelf wordings with several insurers, but this may get messy at the point of claim as disputes can arise between insurers over who responds to the claims or there may be gaps in cover.

AL: An example would be the introduction of technology into healthcare which creates additional complexity through the blurring of lines between technology and the medical professional. For example, if tech fails resulting in bodily injury to a patient, who’s failure was it? Who picks up the claim? Or does it fall between the two? Covering both in one policy removes ambiguity and gives certainty to the insured. 

KK: Working with an insurer who has expertise in this area is much better for an insured. They can identify how liability may arise and can design a policy which responds in the way an insured needs. 

What are the main exposures which give rise to claims? Can you tell us about some of the claims you have handled recently? 

AL: Medical malpractice are the majority of claims we see. We have a number across different areas including individual clinicians, out of hours cover and paramedics. We’re also seeing an increase in telehealth claims. There is a new claim which came in from an insured where a doctor was reliant on a remote radiologist for a diagnosis. The challenge in that situation is the remote specialist is looking at a 2D image in isolation and reliant on the exchange of information with the examining doctor to get a full picture about the patient’s whole condition. Gaps in the information exchange can result in misdiagnosis.

We also see a fair share of healthcare product claims, from multivitamins through to implantable surgical devices. As new products are released to market, we often see regulators playing catch up Regulatory regimes are however becoming more sophisticated and flexible to account for the level of innovation and new products we are seeing. 

JS: Most of the claims I see are where the service provided doesn’t result in the anticipated outcome. I’ve got claims for negligence under this insuring agreement for a rehab exercise which went wrong and resulted in bodily injury through to the failure of a genetic testing laboratory to detect downs syndrome in an unborn child. We also see claims for sexual abuse by bad actor which brings the insureds legal liability in to play for negligence in hiring and supervision.

KK: That’s true, since the #metoo movement there has been an increase in claims for sexual assault within healthcare. It’s an area to keep an eye on. The majority of claims however are allegations of improper care and breach of the standard of care which results in bodily injury.      

What claims trends are you seeing as we emerge from the pandemic? What are the main things which drive severity and frequency? 

AL: We had a period of lower claims activity as insureds were not operating at full capacity owing to the given the cancellation of most non-urgent care. There was also the “halo effect” where patients did not pursue medical malpractice claims owing to the broad public support for healthcare. That has since evaporated, and with professionals clearing a backlog of non-urgent care we’ve seen a return to pre-pandemic levels of claims. Healthcare claims have a long tail and I think we will see a longer tail owing to the disruption of the pandemic, we may see increased claims arising for delay in treatment or diagnosis, particularly for cancer. We are still emerging from the pandemic and still not able to point at trends and we may not know for some time. It can take 3 to 4 years before we have enough information to accurately value a claim. 

Covid claims haven’t been frequent but have been complex. The pandemic placed a lot of pressure on healthcare professionals and supply chains with drugs and oxygen being rationed which has resulted in claims alleging bodily injury. We’ve also seen claims arising from testing services where false positives have caused some form of financial loss, such as causing disruption to filming.

The pandemic aside, no matter where you are in the world, the main driver of severity is the nature of the injury. Brain injuries are the most severe. Where someone requires long term care inflation is going to have an impact on claim value as you need to account for future costs of care in any settlement. Claims inflation is often a difficult conversation with brokers but the unfortunate reality is that claims costs are increasing.  

What lessons did we learn from the pandemic?

AL: We tried to be empathetic with our insureds as they were facing unprecedented amount of upheaval, particularly at the start of the pandemic where there was a lot of rapid change to care delivery. We tried to understand that and be more lenient when it came to the reporting of claims or providing information. For example, if we needed statements or records from an insured, we would give more time to provide this and be more accommodating. 

How do you work with local underwriters to ensure the delivery of quality service to insureds? 

AL: Having claims managers paired with underwriters at each location helps us better evaluate claims due to that local knowledge of courts, claims values and legal standards. We trust in the local expertise we have and share that insight across our global claims team. We meet regularly as a group to discuss trends we see as well as issues on complex or large claims. This information is shared with underwriters, for example I attend 4 meetings a week with underwriters where we talk about claims development and trends. My role isn’t just to handle claims, but to get in front of broker and clients in renewal meetings to help advise them on their exposures and what trends we are seeing in their area.

JS: Working next to the underwriters who write the risks is a huge competitive advantage. There isn’t a day which goes by where I don’t discuss a claim or a risk with an underwriter. We can better honour the intent of the policy and offer greater consistency and certainty to the client as we work so closely together and are joined up. Working as part of a global claims team, with experts in each region, allows us to share knowledge and trends with each other which we also share with clients. It’s nice to have those conversations with clients as they are interested in what is happening in different parts of their industry and what loss trends we have seen elsewhere.

What trends do you see over the next 5 years which would drive severity or frequency of claims?

AL: The law and regulatory regimes are constantly shifting in healthcare. Vicarious liability is a good example where liability used to be easily split between medical professionals and their contractors. It is now blurred and something which ought to be watched. 

Another area where the law is changing would be informed consent. Patients have greater access to information and are more informed about their options. It is no longer strictly the case that the doctor knows best. With new techniques, new medicines, and more awareness about care options professionals need to make sure patients are informed of their options and aware of the risks. 

I’ve already mentioned technology, but it is important to raise again as it is a trend which will impact many areas of healthcare. It can help deliver better quality of care. The remote monitoring of patients using wearable devices can help with early intervention and reduce the need for more complex care. But more data and more tech increases risks, moreover it increases patient expectations about the standard of care they receive.   

JS: I’d say technology and cyber. There is a varying patchwork of data protection laws across Asia Pac, some territories have very strong data protection laws while some are still maturing. They are evolving as we begin to use more technology and data in healthcare.