The US population is aging and more seniors are seeking senior living community facilities to live in during their remaining years. But just as there is a rise in senior living community complexes being built so is there a rise in insurance claims against them.
Why? Because as seniors age they become more fragile and are more susceptible to falls. Falls are the biggest risk factor for senior living centers. In
fact one half of all claims or lawsuits being made are due to falls. And when the facility loses, then the insurers have to pay up and it’s happening more often than not. Which means future rate hikes in 2019 could be as high as 30 percent according to John Atkinson, managing partner at brokerage firm Willis Towers Watson.
“People are living longer and they are more frail,” said Gloria Holland, vice president of finance at Capital Senior Living Corp (CSU.N), a Dallas-based company that runs 129 communities across the country.
Insurance companies are becoming less snd less desirous to provide insurance coverage for senior living community facilities. Some Lloyds of London members have actually stopped providing coverage for them reports Atkinson.
The US is different as far as caring for aging citizens compared to the world.
Here in the US families don’t usually live in close communities or all in one town or city. More often than not they are fragmented and live in different parts of the country. And so, seniors could end up living in a senior living community while family members live in another city or even another state.
While in the EU seniors live in the same town close to family and in generously provided government facilities. In Asian and African societies, seniors usually live with families, in multiple generational groups.
The rise in senior community living facilities being built is a US phenomenon due to the 74 million baby boomers who are retiring in the next seven years or so.
But can these facilities keep up with the rising cost of insurance coverage? Premiums have ranged anywhere from $150 to $600 per room annually depending o the state you live in.
While some insurance companies are denying coverage to senior living communities because of the rising cost of payout to lawsuits and injury claims, there are many others who are seeing the coming baby boomer increase as a boon.
Some are expanding their coverage areas to other states. Many are working with senior living community facilities to help manage their risks with educational solutions.
And senior living community companies are doing their part as well by reviewing their procedures and facilities. As an example one facility replaced carpeting with laminate flooring which is less of a trip hazard. And they are also implementing technology that can help them keep track of residents movements to let then know if residents are at risk of a fall.