By Suzanne Barlyn
(Reuters) – Last March, a 103-year-old resident of a Sunrise Senior Living facility in Willowbrook, Illinois, had gone to the movies. Ruth Smith, who used a walker, fell on two concrete steps in the theater and died about six weeks later. Now, Smith's estate is suing Sunrise, saying his associates were not monitoring her properly.
As the American society ages, living older communities are on the rise. The same goes for claims and lawsuits. And when they lose, it usually belongs to insurers to pay.
"This is a tremendous opportunity that presents unique challenges," said Brendan Gallagher, senior manager for seniors services for insurance broker Arthur J. Gallagher & Co. (AJG.N).
According to insurance broker Willis Watson Towers, some seniors residences could experience a 30% increase in insurance rates in 2019 in 2019. (WLTW.O)
Today, fewer insurers offer coverage than it was five years ago and some members of Lloyd's of London have stopped buying this coverage over the last year, said John Atkinson, managing partner of Willis.
Some insurers completely abandon coverage of these communities while others avoid contentious locations such as Kentucky, Illinois and Florida, insurers and brokers said.
While the withdrawal threatens to increase costs for families, other insurers are developing, capitalizing on the sector's strong growth prospects.
The number of people living in residential care facilities in the United States has increased by more than 10%, reaching 812,000 between 2010 and 2016, according to the latest data from the US Centers for Disease Control and Prevention .
As the industry prepares for the aging generation of 74 million baby boomers, infrastructure for the elderly has become even faster. The number of rooms in these centers has increased by one-fifth since 2013, according to the National Investment Center for Housing and Senior Care (NIC), which collects data on the 99 largest metropolitan areas in the United States. United.
Although aging is a global phenomenon and US society is relatively younger than Europe and North Asia, its increased dependence on senior centers faces challenges that other countries face. could still be faced.
More than previous generations, today's seniors often live far away from their children. In Europe, older people tend to live much closer to their loved ones or in communities that provide generous government services to the elderly. In many Asian and African communities, several generations usually live together.
Not only are more people settling in retiree communities, but they tend to do it later than before, resulting in more frequent and more serious injuries, according to professionals in the community. insurance.
"People are living longer and are more fragile," said Gloria Holland, vice president of finance at Capital Senior Living Corp. (CSU.N), a Dallas-based company that operates 129 communities across the country.
A spokeswoman for Sunrise Assisted Living, where Smith lives, said the company had policies and procedures in place to promote resident safety. "Whenever we lose a member of our community, we are deeply saddened," she said.
<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Falls are the biggest risk. CNA Financial Group (CNA.N) closed its accounts in 2016 and 2017 with nearly half of all assisted living claims, the company said (CNA.N). https://tmsnrt.rs/2GzYrHM) "data-reactid =" 37 "> The most important risk is falls Falls claims account for almost half of all assisted living claims that CNA Financial insurer Group (CNA.N) closed in 2016 and 2017, the company said. https://tmsnrt.rs/2GzYrHM)
The "memory care" centers, which cater to people with Alzheimer's disease and other types of memory problems, are another source of insurance claims. .
The nascent sector has grown 52% since 2013, according to NIC. A big problem here: the residents who are moving away.
Last year, Audrey Penn's body, aged 77, was found in a ditch after leaving an elderly community in Allentown, Pennsylvania. A lawsuit filed by his family resulted in an undisclosed amount.
A CHANGING AMERICA
Capital Senior Living & # 39; s Holland stated that the average age of residents who had settled in its facilities was between 78 and 80 years old when it joined the company in 2004 , to reach today between 82 and 84 years old. This makes individual claims more expensive to settle. The company expects a 5% rate increase when renewing its insurance in 2019, said Holland.
Higher rates and deductibles are more likely to affect smaller facilities, which may lack robust compliance programs to prevent accidents and other problems, according to insurers and brokers. Caroline Clouser, Health Care Lead, Chubb Ltd. Insurer (CB.N), has often stated that "small centers often have trouble adjusting to changing regulations," said Caroline Clouser.
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Insurance premiums for senior institutions vary from state to state. The premiums for each assisted living apartment range from $ 150 to $ 600 a year, according to insurers and brokers.
Insurance for these institutions accounts for less than 1% of the $ 558 billion in property and casualty insurance collected in net written premiums in 2017. Yet, it is likely to grow as aging baby boomers fill seniors' communities, according to the report. industry insiders.
Nationwide is one of the companies that are developing their senior life insurance business while remaining selective, said Jeremy Moore, Head of Underwriting Life.
"You have to understand what exposures and controls are in place," he said.
Nationwide has a team of former senior executives and living administrators who visit communities and review everything from building maintenance to evacuation procedures, Moore said.
The Wisconsin-based Wisconsin-based mutual insurance company, which has industry coverage in 49 states, plans to expand to Florida, the remaining state, in 2019, according to Jim Ketterson, who heads the firm's the insurer.
Brokers are also working to help seniors' communities better manage their risks. Willis recently launched a program to help institutions learn to better lift residents safely.
Willis also organizes a webinar on active shooting events, including tips such as using beds to block doors that do not lock, a common feature in memory processing centers.
Older businesses also continue to review their facilities and procedures, they say. For example, Capital Senior Living is gradually replacing carpeted floor coverings with laminates, which is less likely to stumble, Holland said. He is also considering a technology to track residents' movements to determine if they are at risk of falling.
(Report by Suzanne Barlyn, Edited by Neal Templin and Tomasz Janowski)