What coverage does a CCRC need that a standalone assisted living facility does not?

A continuing care retirement community, also called a life plan community, sells residents a long-term promise: move in now, and care will be available as needs change, often in exchange for a substantial entrance fee that may be partially refundable.

That promise makes a CCRC simultaneously a care provider, a real estate operator, and a financial institution of a kind. The care exposure looks like assisted living and skilled nursing combined. The financial exposure has no equivalent in a standalone facility.

Residents who have paid a large refundable entrance fee are creditors as well as residents, and they have both the standing and the motivation to sue if the community financial position deteriorates.

That produces a claim pattern a standalone facility never sees: actions about how reserves were managed, whether refund obligations were adequately funded, whether disclosures were accurate, and whether the board discharged its duties. Those are directors and officers claims, not professional liability claims, and the liability program will not answer them.

Many CCRCs are nonprofit and governed by volunteer trustees, which sharpens the point: individuals are personally exposed on decisions about an obligation running decades into the future.

Directors and officers, sized against the entrance fee obligation and the debt rather than against the operating budget. Check that the entity itself is covered and not only individuals, that there is an innocent insured carve-back preserving coverage for uninvolved directors, and that the bodily injury exclusion is not drafted so broadly that it pulls governance claims out of coverage merely because a resident was injured somewhere in the story.

Fiduciary liability, separate from D&O rather than sharing a sublimit with it, covering ERISA duties for the employee benefit plans.

Crime with a resident trust fund extension, and sized against balances that at a CCRC can be substantial.

Many CCRCs are financed with tax-exempt bonds, and the bond documents carry insurance covenants in the same way a HUD-insured loan or a REIT lease does. Those covenants were negotiated once and then the program renews annually around them.

On top of that sit state continuing care regulations, which in many states impose reserve, disclosure and financial reporting requirements administered by an agency separate from the health licensing agency. So a CCRC can be answering to a health licensing agency, a continuing care regulator, and a bond trustee at the same time, each with its own requirements.

The practical answer is one reconciliation schedule covering all of them, refreshed at every renewal.

Because a CCRC contains independent living, assisted living, memory care and often skilled nursing on one campus, a single program has to answer four claim profiles at once, and residents move between levels of care as their needs change.

That makes two things important. The professional services definition must be broad enough to cover the whole continuum rather than one licensure category. And the aggregate structure needs thought: a campus with several licensure categories under one aggregate concentrates risk in a way a multi-site per location endorsement would not address, since it is one location.