As Virus Spreads, Insurers Exclude Ebola From New Policies

As fear of Ebola infections spreads to developed economies, U.S. and British insurance companies have begun writing Ebola exclusions into standard policies to cover hospitals, event organizers and other businesses vulnerable to local disruptions.

As a result, new policies and renewals will become costlier for companies opting to insure business travel to West Africa or to cover the risk of losses from quarantine shutdowns at home, industry officials told Reuters.

"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," said Gary Flynn, an event cancellation broker at Jardine Lloyd Thompson Group Plc in London.

While Ebola has killed more than 4,500 people in West Africa, and other diseases such as influenza are arguably more likely to cause measurable harm in the West, the arrival of a few isolated Ebola cases in Western countries has focused their insurers' minds on the virus's potential to cause damage.

The impact on liability insurance has been limited. In the United States, workers' compensation covers medical care and lost income for those who fall ill at work. Because such policies are regulated at state level, Ebola exclusions are unlikely.

Some property and casualty insurers, however, are considering Ebola before writing or renewing policies.

ACE Ltd said on Wednesday that its global casualty unit, which offers coverage for U.S.-based companies whose employees travel or that have operations abroad, was using a policy endorsement to exclude Ebola on a "case-by-case basis" during the underwriting process on new policies and renewals.

It said it was taking into account the risk posed by Ebola to clients who travel to and have operations in African countries with "potentially higher risk exposure."

Others are introducing new products tailored for Ebola.