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Survey Report

Insurance Marketplace Realities 2023 Spring Update – Senior living and long-term care

April 28, 2023

Property renewals, heavily impacted by catastrophic and non-catastrophic loss experience as well as a very difficult treaty reinsurance renewal on January 1, will be most challenging for owners and operators.
Rate predictions: Senior living and long-term care
Trend Range
General and professional liability with favorable loss experience and venue Neutral increase (yellow line, purple triangle pointing up) Flat to +15%, higher with adverse loss experience and/or poor venue
Property with non-challenged occupancies Increase (Purple triangle pointing up) +10% to +20%
Property with challenged occupancies Increase (Purple triangle pointing up) +25% to +40%
Workers compensation Neutral Decrease Increase (flat yellow line, arrow pointing up and down) -5% to +2%
Auto Increase (Purple triangle pointing up) +5% to +10%

Professional liability and general liability

  • Senior living and long-term care liability coverage has continued to stabilize for owners and operators with favorable loss history and venues; however, anticipate higher variability and rate increases for challenging operations.
  • Insurers are reluctant to deploy significant capacity in litigious venues such as NY, NJ, CA and FL. Governor Ron DeSantis of FL recently signed into law HB 837 promising sweeping medical malpractice tort reform, although it remains to be seen how effective this will be to control loss costs in that state. Other less desirable venues are Philadelphia, PA and Cook County, IL.
  • New capacity from Bowhead, Munich Re and Arch has entered and has only started to slightly affect pricing in a positive way.
  • Underwriters have continued incorporating a broader communicable-disease exclusion rather than simply excluding COVID-19. Stand-alone communicable disease liability policies are available, but large capacity is still not available.
  • Sexual abuse and molestation coverage grants may be challenging to obtain. While the primary layer may include this coverage, excess markets may not.
  • Financial challenges have significantly affected the industry during and after the COVID-19 outbreak. In addition, overall economic and social inflation are heightening factors, further increasing insurer scrutiny.
  • Staffing turnover and shortages within the industry have continued. Insurers continue to be very concerned with staffing shortages contributing to loss severity through failure to monitor/appropriate monitoring, unwitnessed falls, late detection of pressure wounds, etc.
  • The reopening of courts may potentially impact COVID-19 claim payouts. To date, many incidents have been reported to insurers, while actual claims with payments have been relatively insignificant.
  • Clients seeking to differentiate their risks must focus on incident reporting, claim mitigation, policies and procedures. Emphasis on the clinical program management will also have a positive impact, particularly for those with a focus on fall management, elopement, medical management, and infection prevention and control.
  • To reduce their total cost of risk, many buyers are assuming larger deductibles or self-insured retentions. Buyers need to be proactive in securing lender waivers when retentions exceed those allowed in standard loan covenants or when captives and other self-insured approaches are used without acceptable fronting or trust arrangements.


  • Ian, a later-season 2022 hurricane, and winter storm Elliott significantly affected many senior living owners and operators. In addition, continued freeze, historic rain, severe convective storms and wildfire losses have driven up insurers’ loss ratios adversely impacting profitability.
  • January treaty reinsurance renewals were impacted by the reduction in capital and increase in exposures, which in turn has led to the “hardest” reinsurance market in approximately 30 years.
  • Valuations continue to be heavily scrutinized, due to significant cost increases evolving from material demand, supply chain issues and labor shortages. Occurrence limits of liability endorsements and margin clauses are frequently considered by insurers to limit their liability in the event of perceived under-valuation of property values.
  • It is expected that every account will see continued pressure on rates, accuracy of property valuations, as well as coverage terms and conditions. To contain cost increases, owners and operators are increasing deductibles as well as purchasing less limit to an amount deemed adequate.
  • Insurers continue to restrict many coverages previously offered, such as communicable disease and cyber. Additional coverage tightening is occurring on CBI (contingent business interruption), service interruptions, deductibles for freeze claims and convective storms.
  • There is continued pressure to move from manuscript to insurer forms.
  • Due to the array of occupancy classifications that can apply to this sector, it is imperative to use accurate occupancy classifications for modeling to ensure the most competitive pricing.
  • Property programs are being heavily marketed, and numerous options are being requested from insurers, significantly increasing underwriter workload. Insurers are being highly selective, and to drive the best results the comprehensiveness and quality of the renewal submission is critical.

Workers compensation

  • Profitable combined ratio for eight years straight and insurers’ reserves are robust — providing a ballast for pricing stability.
  • Underwriting concerns continue regarding opioid addiction, the aging workforce, and medical bill and payroll inflation.
  • Carriers (including incumbents) continue taking an in-depth look at insureds’ COVID-19 and infection control protocols and asking more questions about policies and procedures.


  • Combined ratios continue over 100% while the volume of vehicles on the road and miles driven continue to increase as the pandemic subsides.
  • With the highest economic and social inflation in 40 years, insurance claim costs have continued to rise. Rates and premiums have not kept pace with the rise in claim costs, which results in unprofitable results for insurers.
  • Distracted driving remains a significant issue, and communities with high numbers of drivers using their own vehicles will find more underwriting scrutiny and higher pricing.
  • Higher occupancy vehicles are also viewed less favorably and may add rate to a community’s auto premium if their fleet involves multiple vans and/or buses.


Willis Towers Watson hopes you found the general information provided in this publication informative and helpful. The information contained herein is not intended to constitute legal or other professional advice and should not be relied upon in lieu of consultation with your own legal advisors. In the event you would like more information regarding your insurance coverage, please do not hesitate to reach out to us. In North America, Willis Towers Watson offers insurance products through licensed entities, including Willis Towers Watson Northeast, Inc. (in the United States) and Willis Canada Inc. (in Canada).


Healthcare Industry Vertical Division Leader, North America

Senior Vice President, Risk Specialties

Related content tags, list of links Survey Report Real Estate Healthcare Insurance United States
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