What insurance does a new assisted living facility need?

Combined general and professional liability is the foundation, and combined matters: in senior care the boundary between a premises claim and a care claim is constantly disputed, and a single form from a single market removes the possibility of your own two insurers arguing with each other.

Above it, an umbrella or excess tower. Below and around it: property with business income and extra expense, workers compensation with employers liability, employment practices liability, auto liability including hired and non-owned for staff driving personal vehicles on facility business, crime including a specific extension for resident trust funds, and cyber with HIPAA breach response.

That list is not controversial and most brokers will produce it. The value is not in the list.

Are defense costs inside or outside the limit. Is the abuse and molestation sublimit anywhere near the main limit, does it have its own aggregate, and do the excess layers follow it. If claims-made, does the retroactive date reach back to first continuous coverage. If you have or will have more than one building, does the aggregate apply per location.

Those four questions distinguish a program that will respond from one that will surprise you, and none of them appear in a premium comparison. For a new facility they are also easier to get right at inception than to fix later, particularly the retroactive date, which is set correctly once and then simply maintained.

Many states require a licensed facility to carry liability insurance as a condition of licensure, and some prescribe a minimum limit. You need to satisfy that requirement and file evidence of it, so find out what it is for your state and category and treat it as a compliance task.

Do not treat it as a benchmark. Where minimums exist they are typically set far below what a lender, a landlord, or one serious claim would require, so clearing them tells you almost nothing about adequacy. Confirm the current requirement with your licensing agency rather than relying on a summary, because these provisions are amended more often than operators expect.

Resident trust funds. A standard crime form covers the organization own money; resident personal funds are held in a fiduciary capacity and usually need a specific extension. The regulatory obligation to assure them applies regardless of what the policy says.

Non-owned auto. Even with no facility vehicle, a staff member driving a personal car to collect a prescription or transport a resident creates exposure above their personal limits, which are often minimal.

Ordinance or law. A licensed facility rebuilds to building code and to the physical plant standards attached to its license. The gap between rebuilding what you had and rebuilding what the license now requires is what the increased cost of construction sublimit exists to pay, and the default sublimit is rarely sized deliberately.

Get the licensure insurance requirement in writing from the agency, and get the lender or landlord insurance exhibit if either exists, before you go to market. Those documents define the floor, and building the program to them from the start is far cheaper than amending a bound program.

Then have the structural terms quoted deliberately: ask for the program both with defense outside the limit and with it inside, and both with a full abuse limit and with the market default, so the cost of the better structure is a number you can decide about rather than an assumption someone made for you.