Why is a business owners policy not enough for a licensed care home?

Because the claim you will actually face is a professional liability claim and a general business policy is not written to answer one. A business owners policy covers premises and operations. It does not respond to an allegation that a resident was inadequately assessed, that medication was mismanaged, or that a change in condition was not recognized and acted on.

Some general forms exclude professional services outright. Others simply have no adequate grant, which is worse in a way, because it produces an argument rather than a clear answer at the moment you need one.

The fix is not a higher limit on the wrong policy. It is a combined general and professional liability form from a market that writes senior care.