July 29, 2022

Insurance premiums rise for senior living operators due to pandemic: NIC

McKnights Senior Living

Professional liability and property insurance premiums for senior living operators are increasing thanks to COVID-19, according to the results of a new National Investment Center for Seniors Housing & Care survey.

“Significant” increases in property insurance premiums were reported by 32% of assisted living, 25% of memory care and 24% of independent living operators responding to the NIC Executive Survey Insights Wave 43. Only 6% of independent living operators, and 3% of assisted living and memory care operators, said they experienced declines in property insurance premiums.

COVID-19 litigation, increased fire insurance, inflation on replacement costs and insurance companies leaving local markets resulted in a lack of competition from carriers in certain markets, according to overall survey respondents, a group that also included skilled nursing providers.

Significant” cost increases for professional liability insurance premiums compared with pre-pandemic prices were reported by assisted living (26%), memory care (19%) and independent living (14%) operators. Only 3% of independent living respondents indicated seeing a slight decrease in professional liability insurance premiums.

A nationwide increase in claims frequency and severity, perceived risk associated with COVID-19 deaths, inflation, cost of care and fewer carriers resulting in less competition were cited by participants as reasons for professional liability premium increases.

COVID-19 has continued effect

As in past surveys, the rise of COVID-19 variants BA.4 and BA.5 correlated with a drop in the number of overall operators reporting an acceleration in the pace of move-ins. 

A slowdown in lead conversions / sales (76%), an organizationally imposed ban (18%) and resident or family concerns (6%) related to the pandemic were cited as reasons for the slowed pace of move-ins.

Staffing shortages were not among the reasons operators cited as driving the drop in move-ins, compared with 16% who cited staffing in last month’s Wave 42 survey.

Read More

mailing Mailing List

Sign up to join our email list and receive updates from PALA.

  • This field is for validation purposes and should be left unchanged.