A general and professional liability actuarial analysis
We are pleased to present the third edition of our Senior Living Claims Benchmarking Study: A General and Professional Liability Actuarial Analysis compiled by WTW's Healthcare and Life Sciences Industry Vertical. This year's report underscores that while the underlying dynamics that impact loss costs may be shifting, the end result is the same — loss costs continue to creep higher.
This year's study examines and compares senior living operator data from 2012 to 2021 and our actuarial analysts' estimates for 2022 and 2023. With pandemic era challenges now in the rear-view mirror, senior living providers are turning their attention back to the long-term issues facing America's senior living industry — a rapidly aging population and rising acuity that increases the risk of higher claims volumes and elevated losses if operators are not assigning the right level of care to residents.
Senior living providers continue to face challenging operating conditions as higher costs and an increasingly aging population piles pressure on care givers, particularly against a backdrop of rising acuity. Loss costs between 2012 and 2021 continued to rise in line with projected trends and are expected to maintain that trajectory. However, projections for the past two years suggest the underlying dynamics driving loss costs may be starting to shift.
Resident falls continue to be the largest driver of claims facing senior living operators, accounting for 31% of total ultimate losses, broadly in line with last year. That was followed by wounds and ulcers (20%) and medical management (11%). Falls frequency also increased again over the past year, which means that despite falls having a lower severity relative to other causes of loss, it is still the costliest per exposure. By contrast, wounds and ulcers underscores the need for operators to limit falls risk to help reduce potential loss costs.
While countrywide loss costs are rising, drilling down into the data shows there continues to be a significant regional divergence in performance. Senior living operators across the U.S. continue to face growing loss cost pressures. While those increases have mostly followed trend projections, there is no escaping the fact that loss costs are now rising faster.
To view the report with the full findings, please complete the form to the right.
