Risk Management

Additional Benefits: Broad Regulatory and e-MD Protection

Kimberly Wynkoop, OMIC Legal Counsel

Digest, Spring 2013

OMIC is pleased to announce that the Broad Regulatory Protection and e-MD Protection coverages provided in OMIC’s Professional and Limited Office Premises Liability Insurance policy have been enhanced for 2013 at no additional charge. This article is a summary; for a complete review of your coverage, please refer to the OMIC policy.

Peer review coverage

OMIC’s Broad Regulatory Protection (BRP) reimburses insureds for legal expenses relating to regulatory proceedings, which include billing errors, DEA, EMTALA, HIPAA, covered licensing, and STARK proceedings. BRP also covers fines or penalties related to billing errors, EMTALA, HIPAA, and STARK proceedings. While OMIC’s policy already covered actions by regulatory agencies and state licensing authorities under its Disciplinary Proceeding Protection and BRP, in 2013, it added peer review bodies to the list. Under BRP, OMIC now reimburses legal expenses for professional review actions by the review body of a hospital or other health care facility that could adversely affect the insured’s clinical privileges there.

e-MD additions

As insureds continue to move more of their records, communications, and marketing online, coverage for cyber liability risks becomes more crucial. OMIC’s e-MD Protection now provides seven different coverages. One of the 2013 additions is Multimedia Liability Coverage. It covers claims made against the insured for the display of any electronic or print media by the insured that directly results in defamation, invasion of privacy, plagiarism, or copyright infringement.

Another new coverage is Network Asset Protection. It covers digital assets loss, that is, the expenses necessary to restore or replace the insured’s damaged or stolen data and computer programs, because of accidental damage, operational mistakes, or a computer crime that an insured failed to prevent. It also covers the insured’s income loss and interruption expenses incurred during the time it takes to restore these digital assets.

e-MD Protection now also includes Cyber Extortion and Cyber Terrorism Coverages. Under Cyber Extortion Coverage, OMIC pays money to stop the person responsible from executing a credible threat to release confidential information or corrupt the insured’s computer system. Cyber Terrorism Coverage pays income loss and interruption expenses during a period of restoration of the insured’s computer system required because of an act of terrorism.

e-MD enhancements

While the following provisions are not new, they have been enhanced. The e-MD Security and Privacy Liability Coverage covers claims made against the insured for security and privacy wrongful acts. The Security and Privacy Regulatory Defense and Penalties Coverage covers legal expenses and regulatory fines, penalties, or compensatory awards the insured must pay because of such acts. Many acts fall within the definition of security and privacy wrongful acts. For example, a security and privacy wrongful act occurs if an insured fails to prevent unauthorized access to or infection of the insured’s computer system (a “security breach”) that results in destruction of electronic data stored on the insured’s computer system, unauthorized disclosure of confidential information that is in the insured’s care, or unauthorized access to a computer system other than the insured’s. The insured’s failure to prevent the transmission of computer viruses from the insured’s to a third party’s computer system is also a security and privacy wrongful act. A privacy breach, i.e., a breach of confidence, a violation of rights to privacy, or a violation of laws associated with the control of personally identifiable financial or medical information, also constitutes a security and privacy wrongful act.

The Security and Privacy Breach Response Costs, Notification Expense, and Support and Credit Monitoring Expense Coverage now covers the cost of employing a public relations consultant to mitigate damage to the insured’s reputation due to a publicized report of a privacy or security breach. It also covers the expenses of notifying affected individuals in the event of such a breach. Finally, it pays for the provision of customer support in the event of a privacy breach, including credit file monitoring and identity theft assistance.

The BRP and e-MD per proceeding/claim and aggregate limit is $50,000. The BRP and e-MD Protection coverages also include a two year extended reporting period if the insured acquires tail coverage for the policy. If you have questions about these policy benefits, please call 800.562.6642, ext. 661. If you need to report a proceeding or claim, contact OMIC’s Claims Department at 800.562.6642, ext. 672.