Cyber Liability Insurance for Medical Device Manufacturers
You are the only kind of manufacturer with a statutory duty to keep your product secure after it ships. Cyber Insurance Group has agents dedicated to cyber liability, comparing device manufacturer coverage across 12+ A-rated carriers.
Compare your device business across 12+ A-rated carriers in about 4 minutes. Free, no obligation, and no need to know your limits in advance. We are an independent agency, so the recommendation is based on what covers your risk, not on one carrier’s product sheet.
Get My QuoteThe Risk Left the Building With the Product
For most manufacturers the exposure is in the plant. Here it is in every unit already installed in a hospital.
A long tail in the field
Devices stay in service for many years on software you shipped, in environments you do not control and cannot easily reach to update.
Components you did not write
Open-source and commercial libraries inside your product carry vulnerabilities disclosed on someone else’s timetable, not yours.
Hospital customers who ask
Health systems now run security reviews on devices before purchase and expect documentation, which turns security posture into a sales gate.
Two kinds of harm
Disrupted clinical operations is a commercial claim. Alleged patient harm is a products liability claim. One incident can produce both.
Federal Law Requires Your Product to Stay Secure
Most cybersecurity obligations govern how a company protects its own systems. This one governs the thing you sell.
What the statute requires
A sponsor submitting for a cyber device must submit a plan to monitor, identify and address postmarket cybersecurity vulnerabilities and exploits, including coordinated vulnerability disclosure; design and maintain processes providing reasonable assurance the device and related systems are cybersecure, with known unacceptable vulnerabilities patched on a reasonably justified regular cycle and critical vulnerabilities addressed out of cycle as soon as possible; and provide a software bill of materials including commercial, open-source and off-the-shelf components. Source: 21 U.S.C. 360n-2.
What counts as a cyber device
A device that includes software validated, installed or authorized by the sponsor, has the ability to connect to the internet, and has technological characteristics that could be vulnerable to cybersecurity threats. That definition captures far more of a modern product catalog than most manufacturers initially assume.
Why the bill of materials changes liability
Enumerating every third-party component is sound engineering. It is also a record of what you knew and when. Once a vulnerability is disclosed in a component you have listed, the question in any later claim is not whether you were aware of it but what you did next, and how quickly.
What is actually at risk, by what you make
- Defense and aerospace suppliers: what is really at risk is the government’s controlled unclassified information, and your eligibility to hold contracts at all.
- Chemical manufacturers: what is really at risk is formulations and process data, with no federal chemical security program being enforced since 2023.
- Medical device manufacturers: what is really at risk is the product itself, in a patient, under a statutory duty to keep it secure after it ships.
- Auto and OEM suppliers: what is really at risk is your customer’s production line, and the contractual charges that follow when it stops.
Why it changes the policy conversation
Three policies meet in this sector and the seams matter more than any single limit: cyber for the incident and data exposure, products liability for alleged patient harm, and recall expense for a field action. Ask how each wording treats the other two. Our data breach response guide covers the response itself.
Built for Claims From the Field
Hospital customer claims
Third-party liability responds when a health system alleges your device disrupted its clinical operations.
Establishing scope
Forensic coverage funds determining which units, versions and sites were actually affected, which is the first question regulators and customers ask.
Your own operations
Business interruption responds when manufacturing, quality systems or design records are unavailable.
Data you hold
Breach response covers patient or clinical data held for testing, support or registry purposes, which most device makers hold more of than they expect.
Before You Decide
The objections we actually hear from business owners, answered straight.
What is a cyber device under FDA rules?
The statute defines it as a device that includes software validated, installed or authorized by the sponsor, has the ability to connect to the internet, and contains technological characteristics that could be vulnerable to cybersecurity threats. If your product meets that description, the premarket submission has to address cybersecurity rather than mention it.
What does the law actually require us to do?
Three concrete things, plus whatever else is required by regulation. Submit a plan to monitor, identify and address postmarket vulnerabilities and exploits, including coordinated vulnerability disclosure. Design and maintain processes giving reasonable assurance the device and related systems are cybersecure, with patches on a justified regular cycle and critical vulnerabilities addressed out of cycle as soon as possible. And provide a software bill of materials covering commercial, open-source and off-the-shelf components.
Why does a software bill of materials matter for liability?
Because it removes the defense of not knowing. Once you have enumerated every third-party component in your product, a vulnerability disclosed in one of them is something you are on notice of. That is good engineering practice and it is also a documented timeline that a claimant’s counsel can read back to you.
Is our exposure the patient or the hospital?
Commercially it is usually the hospital, and legally it can be both. A health system whose clinical operations are disrupted by a vulnerability in your device has a contractual and negligence argument against you. Where patient harm is alleged the claim moves toward products liability, which is a different policy from cyber and should be coordinated with it.
Does cyber insurance cover a recall or a field correction?
Generally not. Recall expense is its own coverage and is usually bought separately, and many cyber wordings exclude product recall explicitly. For a device manufacturer the realistic worst case often includes a field action, so confirm where that sits before assuming the cyber policy reaches it.
What does cyber liability insurance not cover for a device manufacturer?
It does not pay to redesign the product, fund the patch program or run a field correction. It generally does not answer bodily injury claims, which belong to products liability. And it does not cure a premarket submission that failed to address cybersecurity. It responds to the incident, the data exposure and the third-party claims that follow.
What Would Cyber Liability Insurance Cost Your Device Business?
Pricing follows your product mix, how many connected units are in the field, your patching and disclosure process, and the controls you can evidence. See the breakdown in our cost guide, or get a number for your company.
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