A general and professional liability actuarial analysis
We are pleased to present the fourth edition of our Senior Living Claims Benchmarking Study: A General and Professional Liability Actuarial Analysis completed by WTW’s Senior Living Center of Excellence. The long-term trend of loss costs creeping higher for senior living operators persisted over the past year as claims frequency continued to rise. While falling severity levels have acted as a handbrake on loss costs rising faster, our analysts are forecasting severity to be broadly flat over the coming year, suggesting that handbrake could be about to weaken.
This year’s study reviews senior living operator data from 2013 to 2022 and our actuarial analysts’ estimates for 2023 and 2024. This comes at a challenging time for senior living operators who are navigating a raft of issues. To start, state-specific regulation continues to impact service provision. Second, demand for beds is rising, placing a strain on services. And third, staff shortages continue to plague the industry while an aging population increases the need for more acute care, all of which is piling pressure on senior living operators and potentially exposing providers to even higher costs.
The biggest driver of losses for senior living operators was, once again, incidents involving resident falls, representing 30% of total losses between 2013 and 2022. That was followed by wounds and ulcers (slightly higher at 20%) and medical management (also up one percentage point to 12%). Claims frequency for falls also increased, rising to 1.66 per 1,000 exposures, up from 1.41 a year ago. That higher frequency meant loss costs per exposure were $240, up from $225 last year and dwarfing the next highest — wounds and ulcers — at $145.
Loss costs continue to vary significantly between states, often driven by the local regulatory environment. In line with our previous benchmarking reports, the study shows results from the largest states for senior living in the U.S. and where enough data was generated to be statistically meaningful.
To view the report with the full findings, please complete the form to the right.
