How CRO Insurance Should Be Structured

What’s in this article

You’re negotiating a sponsor contract that requires specific insurance types and minimum limits, reviewing a broker’s renewal proposal that doesn’t quite match your contractual obligations, or explaining to a potential client what coverage you actually carry. The question isn’t whether you need insurance—you do. The question is whether your programme matches the operational risk you’ve accepted, aligns with the indemnities you’ve signed, and responds properly when a monitoring failure or data quality issue triggers a claim.

This article gives you the practical structure: what policies a CRO programme needs, how to align coverage with sponsor contracts, what limits make sense for your business scale, and how to handle claims when they arise. It’s written from the underwriting and broking perspective—what actually matters when programmes are placed and claims are paid.

What policies should a CRO programme include as standard?

A functioning CRO insurance programme is layered. No single policy solves every exposure.

Professional indemnity insurance is the foundation. It covers liability for errors, omissions, and negligent performance of contracted services: monitoring failures, data quality issues, protocol deviation failures, safety reporting delays, and site oversight lapses.

This policy responds when your professional services cause financial loss or injury to a client or trial participant. It’s typically written on a claims-made basis, meaning it covers claims made during the policy period, not incidents that occurred during it.

Public liability (general liability) covers third-party bodily injury and property damage at sites you visit or operate. If your monitor trips a participant in a clinic corridor or damages site equipment during a visit, this responds. It’s not the same as professional indemnity—it covers physical accidents, not professional service failures.

Employers’ liability is legally required in the UK if you have employees. It covers claims from employees injured or made ill through work activities. This is mandatory by statute—£5 million minimum—and practically, CROs often carry £10 million or more.

Cyber and data breach insurance responds to data protection failures: ransomware attacks, data breaches exposing participant information, accidental data disclosure, and GDPR penalty defence. Clinical trials generate vast amounts of personal and special category data. Cyber risk is material and growing.

Clinical trials liability in some cases. If you’re acting as a legal co-sponsor or have accepted contractual responsibility for participant injury claims, you may need dedicated clinical trials insurance. Most CROs don’t carry this unless they’re co-sponsoring trials—they rely on the sponsor’s clinical trials policy covering participant injury.

Directors and officers (D&O) liability if you’re a company with external shareholders or complex ownership. It covers claims against directors and officers for breach of duty, mismanagement, or regulatory failures. As CROs grow and take outside funding, this becomes essential.

First-party covers: business interruption, property insurance, and errors and omissions for lost data or failed backups. These protect your balance sheet when operational failures cost you money rather than creating third-party liability.

Sponsor contracts routinely specify minimum insurance types and limits. Misalignment creates friction at contract negotiation and coverage gaps at claims time.

Standard sponsor requirements typically include:

Professional indemnity: £5 million to £10 million per claim, aggregate £5 million to £20 million.
Public liability: £5 million to £10 million per occurrence.
Employers’ liability: £10 million (often above the UK statutory minimum).
Cyber insurance: £2 million to £5 million if handling trial data.
Clinical trials insurance: only if you’re co-sponsoring or accepting participant injury liability.

What to check before signing sponsor contracts:

Do your current policy limits meet or exceed the contract minimums? If the contract requires £10 million professional indemnity and you carry £5 million, you need to increase limits or negotiate the contract down.

Does your policy scope cover the contracted services? If the contract says you’ll provide regulatory submission support, does your professional indemnity policy cover regulatory advice, or is it excluded?

Are there territorial limits? If you’re conducting trials in multiple jurisdictions for the sponsor but your policy only covers UK operations, you have a coverage gap.

Do policy periods align? If your professional indemnity renews in March but you sign a contract in January, ensure your policy covers the full contract term including any retroactive date issues for prior work.

Practical approach:

Request sponsor insurance requirements before final contract negotiation. Share them with your broker. Confirm coverage, arrange endorsements if needed, and obtain updated certificates. Don’t sign contracts assuming your programme covers requirements—verify first.

If a sponsor requires limits above your programme, you have three options: increase your limits at renewal, negotiate the contract requirement down to match your coverage, or decline the contract.

What limits actually make sense for CRO insurance, based on your scale and contract portfolio?

Insurance limits should reflect your revenue, contract values, and the cumulative indemnity exposure across your portfolio.

Professional indemnity limits:

Small CROs (sub-£2 million revenue): £2 million to £5 million per claim is typical.

Mid-size CROs (£2 million to £20 million revenue): £5 million to £10 million per claim.

Large CROs (£20 million+ revenue): £10 million to £25 million per claim, with higher aggregate limits.

The driver isn’t just revenue—it’s the value of individual contracts and the number of concurrent trials. If you’re managing a single £500,000 contract, £2 million per claim may be adequate. If you’re managing ten contracts worth £2 million each, you need higher limits to cover potential claims across your portfolio.

Aggregate vs per-claim limits:

Many professional indemnity policies have both per-claim limits and aggregate limits (total paid across all claims in the policy period). If your aggregate limit is £5 million but you face three separate claims of £2 million each, you exhaust your policy after the first three claims.

Ensure aggregate limits are appropriate for your contract volume. High-volume CROs with many concurrent trials need aggregate limits at multiples of per-claim limits.

Public liability limits:

£5 million is standard for most CROs. Some contracts require £10 million. The risk is lower than professional indemnity—physical accidents at sites are less frequent and less severe than professional service failures—but the exposure exists.

Cyber limits:

£2 million to £5 million for CROs handling significant trial data volumes. The exposure includes GDPR penalties (which can be substantial), notification costs, forensics, legal defence, and business interruption.

If you’re managing data for multiple global trials with thousands of participants, consider £5 million or higher.

How should CRO insurance handle contractual indemnities you give to sponsors?

CRO contracts typically include indemnity clauses requiring you to indemnify the sponsor for losses caused by your negligence or breach. These must align with your insurance.

What CROs typically agree to indemnify:

Losses caused by your negligent performance of contracted services.
Monitoring failures that cause protocol deviations or delayed safety reporting.
Data quality failures that affect trial integrity.
Breach of confidentiality or data protection obligations.
Your employees’ or subcontractors’ negligence in trial activities.

What CROs should resist indemnifying:

Protocol design defects. You didn’t design the protocol; the sponsor did. This is sponsor liability.
Investigational product failures. Manufacturing defects, contamination, product design issues—these aren’t your responsibility unless you control manufacturing.
Sponsor oversight failures. If the sponsor fails to monitor your work adequately, that’s not your professional failure.
Unlimited financial exposure. Indemnities should be capped at your insurance limits or contract value multiples.
Third-party vendor failures. If a laboratory you didn’t select delivers faulty analysis, that’s not your indemnity unless the contract made you responsible for vendor selection.

Practical negotiation principles:

Push for proportional, fault-based indemnities tied to your negligence or breach. Resist blanket “any and all losses” language.

Cap indemnities at your professional indemnity CRO insurance policy limits. If you carry £5 million cover, cap indemnities at £5 million.

Exclude indemnities for risks you don’t control. You can’t indemnify for protocol design if you didn’t design it.

Ensure indemnity language matches your policy triggers. If the contract requires you to indemnify for “losses arising from or related to” your services but your policy only covers “losses caused by negligence,” you have a gap.

What about CRO insurance for subcontractors and pass-through risk?

If you subcontract work—site monitoring, data management, regulatory submissions—you need to manage subcontractor insurance.

Standard approach:

Require subcontractors to carry professional indemnity insurance with limits proportionate to the work they’re performing. If you’re passing £200,000 of monitoring work to a subcontractor, require them to carry at least £1 million professional indemnity cover.

Obtain certificates of insurance before work begins. Verify they’re current and cover the contracted scope.

Be named as an additional insured where appropriate. This gives you direct recourse to the subcontractor’s insurer if their work causes a claim against you.

Pass-through risk:

If a subcontractor’s failure causes a sponsor claim against you, your professional indemnity policy may respond, but you then need to recover from the subcontractor. This requires:

Clear contracts allocating liability to the subcontractor.
Evidence the subcontractor carries adequate insurance.
Preserved documentation showing the subcontractor caused the failure.

Don’t assume you can automatically pass liability to subcontractors. Without proper contracts, insurance evidence, and documentation, you may end up carrying the full loss on your CRO insurance.

How do claims actually work for CROs—and what preserves coverage?

Professional indemnity claims follow a predictable process. Understanding it helps you preserve coverage and control outcomes.

Typical claim trigger:

A sponsor notifies you that a monitoring failure at multiple sites caused protocol deviations that weren’t identified for three months. Participants were dosed incorrectly. The sponsor faces potential participant injury claims and regulatory scrutiny. They’re invoking the indemnity clause in your contract.

Your immediate response:

Notify your professional indemnity insurer immediately. Late notification can prejudice or void coverage. Provide:

The sponsor’s claim letter or notification.
Your contract showing your scope of work and indemnity obligations.
Monitoring visit reports and documentation of your work.
Evidence showing what monitoring you performed and when.
Any correspondence about the deviation.

Insurer investigation:

The insurer appoints a claims handler who investigates:

Did you breach your contracted obligations?
Was the monitoring frequency below what the contract required?
Should you have identified the deviations earlier?
What does your documentation show?

They may appoint independent experts to review your monitoring processes and assess whether you met professional standards.

Outcome scenarios:

If the investigation concludes you breached contracted monitoring standards, the insurer defends or settles the claim within your policy limits.

If the investigation concludes the deviations resulted from unclear protocol instructions (sponsor’s responsibility) or site failures beyond your monitoring scope, the insurer may deny coverage or negotiate proportional settlement reflecting shared fault.

What preserves CRO insurance coverage:

Prompt notification of potential claims, not just formal claims.
Complete contemporaneous documentation of your work.
Evidence you followed contracted monitoring frequency and procedures.
Clear contracts showing scope and limitations of your responsibilities.
No admissions of liability before consulting your insurer.

What prejudices coverage: late notification, missing documentation, admissions of fault without insurer involvement, or work performed outside policy scope.

Practical programme management: what to do annually

CRO insurance isn’t a one-time purchase. It requires annual maintenance to stay aligned with your business.

At renewal:

Review all active sponsor contracts for CRO insurance requirements. Ensure renewal limits meet or exceed all contractual minimums.
Update your broker on new services you’re offering. If you’ve started regulatory submission support, ensure professional indemnity covers it.
Disclose claims, incidents, and near-misses from the past year. Non-disclosure can void coverage.
Review retroactive dates. Ensure your professional indemnity policy covers all work you’re still contractually liable for.

Quarterly:

Collect updated insurance certificates from active subcontractors.
Review new sponsor contracts for CRO insurance requirements before signing.
Check policy expiry dates and set renewal reminders.

When incidents occur:

Notify your insurer immediately, even if you’re uncertain whether it’s a claim.
Preserve documentation: emails, monitoring reports, correspondence with the sponsor.
Don’t speculate about liability or causation to the sponsor before consulting your insurer.

Bottom line for CRO insurance

A CRO insurance programme needs professional indemnity as the foundation, supported by public liability, cyber coverage, and employers’ liability as standard. Limits should reflect your revenue, contract portfolio, and cumulative indemnity exposure across active trials.

The programme must align with sponsor contract requirements—verify coverage before signing contracts, not after claims arrive. Indemnities you give should be proportional, fault-based, and capped at insured limits. Subcontractor work requires insurance evidence and clear liability allocation.

Claims management requires prompt notification, complete documentation, and no admissions of liability before insurer involvement. Annual renewal requires reviewing contract obligations, disclosing incidents, and ensuring coverage keeps pace with business growth and new service offerings.

When structured properly and maintained actively, your CRO insurance programme becomes an operational asset—it enables contract negotiation, supports client confidence, and responds properly when professional failures occur. When neglected or misaligned with contracts, it becomes a latent liability that surfaces exactly when you need it most.

External Resources

Association of Clinical Research Organizations (ACRO). Global CRO industry association with standards and guidance.
Society of Clinical Research Sites (SCRS) – Risk Management Resources. Professional guidance on site and CRO risk management.
European Clinical Research Infrastructure Network (ECRIN). European standards for clinical research operations.

Simplify Stream provides educational content about business insurance for UK companies, especially those with high growth business models that require specialist insurance market knowledge. We don't sell policies or provide regulated advice, just clear explanations from people who've worked on the underwriting and broking side.