TL;DR
Cost
A continuing care community sells decades, not a lease, and the insurance follows from that promise rather than from the buildings. The liability line prices as a blend across the levels of care on campus, which makes the per-unit figure a function of your unit mix more than of anything else.
The number worth attention sits elsewhere. A community holding refundable entrance fees has an obligation that looks financial and behaves fiduciary, and the coverage answering it is sized against the obligation rather than against operating revenue.
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Blended per unit across levels of care, with governance lines priced separately against the entrance fee obligation.
General and professional liability, per occupied bed per year
$800 to $5K
Typical programmes at 150 to 600 units across levels of care
Blended across levels of care, and excludes the D&O and fiduciary loading that the entrance fee obligation adds on top.
A span the market produces across the country, not a benchmark and not a quote. The width is the state effect, not uncertainty about any one building.
Unit mix by level of care. A campus that is eighty percent independent living blends toward the low end; one with a large skilled component blends toward the high end. Two campuses with the same unit count can be very far apart.
The entrance fee structure, and specifically whether fees are refundable, at what percentage, and what the refund obligation totals. That figure drives the directors and officers limit and is the number a board should be looking at.
Bond covenants where the campus is financed with tax-exempt debt. Those documents frequently specify coverage lines, limits and carrier rating minimums, and they are requirements rather than preferences.
Sponsorship. Nonprofit and faith-affiliated campuses governed by volunteer boards carry governance exposure that a for-profit operating structure does not present in the same way.
Occupancy and the fill-up curve, because a community with an entrance fee obligation and soft occupancy has a solvency profile underwriters read directly.
State claim environment, applied across the skilled and assisted portions of the campus.
The blended figure is liability only, and it excludes the loading the entrance fee obligation adds.
Directors and officers, sized against refund obligations and outstanding debt rather than against revenue, with entity coverage and a carve-back so governance claims connected to quality of care are not excluded as professional services.
Fiduciary liability for the employee benefit plans, which is separate from directors and officers and which most boards assume is covered by it.
Crime with a resident funds extension sized against real balances.
Property on a campus scale, business income measured against a realistic rebuild plus lease-up, and ordinance or law where the building stock is old.
Present the campus by level of care with unit counts, not as a single blended entity. An underwriter shown a campus without the mix will price it at the more severe assumption.
Governance documentation: a benefits committee with a charter and minutes, a documented investment policy, and documented periodic fee benchmarking. These are the prudence defense and they are also what a fiduciary underwriter asks for.
Actuarial soundness of the entrance fee obligation, which several states require to be filed anyway and which is the most persuasive document a CCRC can put in front of a directors and officers market.
Read the bond covenants before the renewal rather than during it. Discovering a covenant requirement two weeks before expiration removes your ability to negotiate anything.
What does not work: treating the campus as a single risk. The whole point of a continuing care community is that it is several businesses under one promise, and pricing it as one thing gets it priced as the worst thing.
Cost questions
Because the community holds money it has promised to give back. Claims here allege the board permitted the organisation to accept entrance fees while knowing refund obligations could not be met, and they are pled against directors personally. Size the limit against the refund obligation, not against revenue, and confirm the policy does not exclude claims arising from the entrance fee contract through a contractual liability exclusion.
Yes. State volunteer immunity statutes and the federal volunteer protection statute are real but narrow: they generally do not cover gross negligence or employment claims, and immunity is a defense rather than a defense fund. A protected director still has to hire a lawyer to establish the protection.
The covenant sets a floor, not a ceiling, and it rarely addresses the terms that actually matter in this class. Defense treatment, the abuse sublimit and the aggregate basis are almost never specified in a bond document, which means they are yours to negotiate and yours to get wrong.
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Cost by other settings
Per occupied bed, per year, then loss rated above a certain size.
Per occupied bed or unit, per year.
Per occupied bed, per year, loaded above the assisted living band.
Per occupied bed, per year, with minimum premiums that fall on very few beds.
Per unit, closer to habitational real estate than to licensed care, with a professional liability component that is often absent and should not be.
Payroll and revenue, not beds. Rating follows the workforce and the service scope rather than a building.
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