Does a six-bed residential care home need the same coverage as a large community?

Small residential care homes are frequently written on a business owner policy or a general liability policy sold as small commercial. Those forms cover premises liability. They typically exclude the rendering of professional services, which is where every serious senior care claim lives.

The result is an operator with a certificate, a premium, and no coverage for the claim that will close the business. It is the most common and most consequential finding in this part of the market, and it usually surfaces at the first serious incident.

The resident in a six-bed home has the same acuity, the same fall risk and the same family as the resident in a two hundred bed community. A wrongful death claim does not scale with the number of beds; it scales with the injury.

Small homes also carry two aggravating features. Staffing is thinner overnight, often a single caregiver, which is the fact pattern that produces supervision claims. And documentation is usually paper and sparse, which converts a defensible incident into an indefensible one.

Professional liability covering the rendering of care, with the abuse and molestation endorsement included rather than excluded, since abuse is commonly excluded outright at this size and the exclusion is the whole exposure.

General liability, property on a replacement cost basis, workers compensation, non-owned auto if anyone transports residents, and an umbrella that actually schedules the professional policy as underlying.

Limits are a judgment call. A limit in the range of $1M per occurrence is the common starting point, and operators in high-severity states should treat that as a floor rather than an answer. The retention should be small, because a small home cannot fund a large one.

Does this policy cover a claim that we failed to provide adequate care, in writing, with the coverage part named. And is abuse and molestation covered or excluded, with the sublimit stated.

If either answer is unclear, the policy is probably not the right one. Both answers should take an agent who works in this class under a minute, and an agent who has to check is a signal in itself.