Overview of the HealthTech industry

The HealthTech industry is well-known for being a complex and heavily regulated sector—but for a good reason. HealthTech uses technologies to help patients to receive more efficient, affordable, and convenient care outside of a typical medical office setting. Not only are individuals impacted by this technology, but payers and players in the space are, as well.

Although the growth of healthcare spending is relentless worldwide, it’s still the least digitized space of global markets. Life expectancy is increasing across the globe, and caring for those who are 65 years and older accounts for ⅔ of all healthcare costs. However, providers, insurers, and drug companies are recognizing the potential for digital technology.

Plus, high-deductible healthcare plans have become more prevalent, increasing the out-of-pocket costs for patients. This trend motivates them to be more price-sensitive about healthcare costs. What’s more; is that individuals are more open to innovative healthcare technology, such as via smartphone apps and telemedicine.

Some of the biggest risks HealthTech companies face

Most of the exposures HealthTech companies suffer overlap tremendously; they all intertwine with one another in some way. Naturally, this makes navigating these specific risks a massive challenge. The following are the most widespread risks in the HealthTech industry:

Privacy & Cybersecurity

A quarter of all US data breaches play out in healthcare. Privacy and cybersecurity have never been more daunting for healthcare companies than it is in the modern world. From ransomware to DDoS attacks to costly data breaches, personalized health data is particularly vulnerable to threats because of the high volume of sensitive information.

As with any tech company, data privacy is a massive concern. But, all the while, HealthTech must also comply with HIPPA, PHI, etc. More than mere security breaches, this industry must face accidental data disclosures, human errors, and more threats—mainly from third-party vendors.

Regulatory Compliance

HealthTech companies face unique risks in complying with federal, state, and local regulators—which are often wildly different. Regulatory compliance increases exposure and expense in the healthcare sector. Plus, it also impacts business models significantly. Some of the compliance risks include:

  • Managing various government payers
  • Meeting state licensing and practice requirements
  • Addressing state medical board actions
  • Interpreting old regulations that are behind the times
  • Complying with HIPAA 

Patient Injuries

Client injuries in any industry typically mean both financial and reputational damage—and the healthcare space is no different. In high-income countries, one in ten patients is injured while receiving care, and 50% of those injuries are preventable. That said, patient injuries could happen for several reasons.

Human error, system breach, technology failure could all cause injuries, to name a few. Preventing or mitigating the aftermath of patient injuries is often a time-consuming and costly endeavor.

Why is Insurance for HealthTech Companies Important?

Healthcare is an industry continually in flux. However, with Baby Boomers requiring more medical attention and younger generations desiring more control in their overall wellness, this market faces unique challenges. Keeping up with the aging population is one hurdle, and catering to a tech-savvy generation is another. 

Most of all, HeathTech companies have gathered mounds of medical data—but safely and effectively applying that information is what sets good companies apart from incredibly successful ones. Insurance for HealthTech isn’t only suggested for harnessing the powerful waves of healthcare demands; it’s necessary to keep afloat.

As mentioned, some significant vulnerabilities exist in the healthcare sector. To navigate this terrain, it’s best to prepare for various exposures and to stay updated on current events. 

What are some of the best HealthTech conferences?

To stay in the know, it’s best not only to do your homework but also to network within the industry. Here are some of the most productive conferences that will keep you up-to-date on industry developments We recognize that many 2020 events have been canceled or postponed (due to direction from the World Health Organization (WHO) and the Center for Disease Control (CDC) regarding the COVID-19 Coronavirus) however we thought it would still be a useful resource:

  • HIMSS Conference – Healthcare Information and Management Systems Society (HIMSS) is a large organization dedicated to improving the healthcare system. The nonprofit group usually hosts an annual HIMSS Conference
  • Health 2.0 VentureConnect – As part of HIMSS organization, the Health 2.0 event features the latest innovative health-related technologies and offers the chance to network with peers.
  • JP Morgan Healthcare Conference – For the 38th year, this JP Morgan event touts as being the largest and most informative healthcare symposium in the industry.
  • StartUp Health Festival – Since 2011, StartUp Health has taken place alongside JP Morgan’s conference. However, it’s an invite-only experience.
  • Rock Health Summit – An invitation-only event, the Rock Health Summit helps to gather healthcare professionals to participate in candid discussions and multiple workshops.
  • HLTH Conference – With four days of inspiring content, HLTH is designed for senior executives in the health industry.

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What Insurance do HealthTech companies need?

How much does Insurance for HealthTech Companies cost?

The cost of insurance for HealthTech companies will depend on several things, including the size of the company and the stage of the company in its development process. Other factors include:

  • Exposures: risks being insured.
  • Company practices: views on safety, compliance, and risk management. 
  • Program structure: the amount of deductible and willingness for a company to assume more risk
  • Claims history: the type and amount of past claims against the company 

Types of HealthTech Companies that need Insurance

It’s no surprise that cybercriminals pay no mind as to what kind of company they attack. Plus, human error is merely unavoidable no matter the industry. Here are several types of HealthTech companies that need insurance:

  • Insurance Companies (e.g., Oscar)
  • Wearables
  • Implantables
  • Home Testing
  • Genetic Testing
  • Telemedicine
  • AI-assisted diagnostic imaging
  • Remote monitoring

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