A major corporate insurer has said it’s beginning to exclude Ebola-related liability claims for companies whose employees travel to West Africa as part of the job, The Wall Street Journal reports.
ACE Ltd, a global property and casualty insurer based in Switzerland, has started to exclude Ebola from coverage “on a case-by-case basis” for its U.S. customers “that have foreign travel exposure to certain African countries,” the company told WSJ.
They’re not going back on policies that are already in action, but are introducing the new restrictions on new and renewal policies. ACE is the first major insurer to restrict coverage claims related to Ebola infections.
Other insurance companies are rapidly upping their rates for policies that include Ebola coverage, Reuters reports. Ebola-related disruptions are a problem for companies operating in West Africa or for those sending employees to Ebola-affected areas — hospitals and event organizers especially.
“What underwriters are doing at the moment is they’re generally providing quotes either excluding or including Ebola — and it’s much more expensive if Ebola is included,” Gary Flynn, a London event cancellation broker, told Reuters.
For one, insuring an event without Ebola coverage would cost close to 0.1 percent of their potential revenue, Flynn explained. But when Ebola coverage is included, the cost rises to 0.3 percent.
Two London insurers launched a new policy just last week to insure hospitals against losses incurred in case an Ebola quarantine shuts down their normal operations, according to Reuters. It’s the first product of its kind during this Ebola outbreak.
It’s unlikely to become a problem for health insurers in the U.S., as workers’ compensation covers medical care for illnesses and injuries that workers obtain on the job.
West Africa’s Ebola outbreak has a lot of potential to cause world-wide economic damage. The World Health Organization estimates that the 2003 SARS outbreak cost the hardest-hit East Asian countries up to $20 billion, and the U.S. $7 billion although there were no deaths in the country.
The World Bank now predicts that if the Ebola crisis continues for two years, the West African economy could lose as much as $32.6 billion.