What You Need to Know About Insurance for Assisted Living Facilities
WLS Insurance Agency provides tailored insurance for senior living facilities as well as for both for-profit and non-profit entities, covering general liability, property, workers’ comp, and more.
Assisted living facilities need a variety of insurance policies to protect against potential risks, including general liability, professional liability, property, and workers’ compensation insurance. Additionally, some facilities may need specialized coverage like sexual abuse and molestation liability, active shooter liability, and communicable disease liability.
Types of Insurance for Assisted Living Facilities:
General Liability Insurance:
This is a fundamental coverage for any business, including assisted living facilities, and protects against claims of bodily injury, property damage, and personal injury that may occur on the premises.
Professional Liability Insurance:
This coverage protects the facility against claims of negligence, errors, or omissions in the care provided to residents.
Property Insurance:
This covers the physical building and its contents from damage due to events like fire, storms, or vandalism.
Workers’ Compensation Insurance:
This is required in most states and provides coverage for employees who are injured on the job.
Commercial Auto Insurance:
If the facility owns vehicles, this coverage protects against accidents involving those vehicles.
Sexual Abuse and Molestation Liability Insurance:
This coverage protects against claims of sexual misconduct or molestation by employees or others associated with the facility.
Active Shooter Liability Insurance:
This coverage protects the facility against claims arising from an active shooter event on the premises.
Communicable Disease Liability Insurance:
This coverage protects against claims related to the spread of infectious diseases.
Cyber Liability Insurance:
As facilities store sensitive resident information, this coverage protects against cyberattacks and data breaches.
Frequently Asked Questions and Answers
Assisted living facility insurance and residential care insurance are the same thing, just with two different names. Both coverages are tailored for elderly care facilities and can come in all shapes and sizes, depending on the business. There isn’t a one-size-fits-all assisted living facility insurance policy able to cover all your risks, but this means you can tailor coverage to meet your needs.
While most states don’t have any insurance requirements strictly for residential care facilities, many do require assisted living centers to maintain a couple of specific surety bonds, which you can find more information about in the next section.
Even though there aren’t any requirements, a basic insurance policy bolsters any existing safety measures you have in place. If you cannot repair necessary equipment or handle any fees associated with unexpected litigation, you should consider assisted living facility insurance.
Not every residential care facility looks and operates the same way, so insurance will also vary based on the facility. Key potential coverages you may consider for your assisted living home include:
- Professional Liability — You and your employees are legally responsible for the care of your facility’s residents. Often, this care includes giving residents their medication at certain times, helping with physical therapy, and general supervision and care. If something happens to one of your residents because you or an employee were inadvertently negligent or an accident occurred, then you can be faced with litigation. Professional liability insurance, also called errors and omissions insurance, offers you financial protection in cases like these.
- Commercial Auto — If you transfer any residents from place to place using a facility-owned vehicle, you should have business auto coverage. Commercial auto insurance can offer your company financial protection for accidents involving company-owned vehicles.
- Commercial Liability — Your assisted living home is potentially liable for every product, service, and operation related to your business. Even though you stress sound procedures throughout your business, the fact remains that no person is perfect. Despite your best efforts, if your business causes any property or physical damage to a third party, you and your business may face litigation. Commercial liability insurance is designed to protect business owners and assets from common business risks like injury or property damage.
- Commercial Property — Imagine a fire breaks out, and you lose your entire inventory. Or your business is burglarized, causing physical damage and possibly lost assets. Your ability to recover from these incidents is dependent on your commercial property insurance.
- Cyber Liability — In today’s digital world, cybercrime runs rampant. Data breaches are an all-too-common occurrence and are commonly targeted towards small businesses. You probably store sensitive customer information, such as account numbers, insurance information, driver’s license numbers, and credit card numbers. Suppose you are the victim of a data breach. In this case, you are liable for any damages caused by the breached information.
In the section above, we mentioned that most states require your facility to have a couple of surety bonds. While surety bonds aren’t considered insurance, they are usually sold by insurance companies. So, here are the two most common surety bonds you’ll need.
- Patient Trust Bond/Nursing Home Care Bond — Put simply, this bond is a guarantee your facility will comply with all state and federal laws and use patients’ trust funds in an ethical and financially responsible manner.
- DMEPOS Bond/Medicare Bond — If you bill Medicare for durable medical equipment, prosthetics, or orthotics through your assisted living facility, then you need a DMEPOS bond.
This is a question we would love to answer, but there’s not a single number we can give. Ultimately, your premiums will vary based on several factors, some of which are:
- Your facility’s location
- Number of employees
- Services provided
- Number of beds
- Employee payroll
- Your chosen deductible
- Per-occurrence limit
As professionals in assisted living facility insurance, we make it our business to know you and your concerns. We spend time listening and learning to better serve you, our clients.
You’ve worked incredibly hard to build your business. The next step is to protect it. We’ll assess your risks and help tailor an insurance policy for your residential care facility.