For assisted living operators, staffing challenges are nothing new. But today, high turnover and unfilled positions are no longer just an operational burden—they are increasingly an insurance risk.
The Numbers Behind the Crisis
- A LeadingAge poll found 70% of assisted living facilities report significant or severe workforce shortages, with 64% saying the situation has not improved year-over-year.
- In many communities, 20% of positions remain vacant with no applicants, forcing operators to rely on overtime and costly agency staff.
- According to the National Investment Center, over half of senior living operators saw liability insurance premiums increase in 2023, with facilities experiencing staffing instability facing hikes of 30% to 50%.
Why Insurers Are Concerned
From an underwriter’s perspective, staffing shortages mean increased exposure:
- Lower staff-to-resident ratios raise the risk of neglect allegations.
- Burnout and turnover heighten the likelihood of errors, accidents, or lapses in care.
- Agency staffing may leave insurers questioning training consistency and accountability.
The Consequences
Insurance carriers are responding with:
- Premium surcharges for facilities struggling to stabilize staffing.
- Policy non-renewals in severe cases, even for operators with otherwise clean records.
- Tighter underwriting requirements, including documentation of staff training and retention efforts.
How Facilities Can Protect Themselves
Homewood Insurance recommends operators:
- Document staff training and protocols—show insurers your risk management plan.
- Highlight retention initiatives—demonstrating efforts to reduce turnover matters.
- Engage an experienced broker—one who understands senior living risks and has access to carriers willing to work with facilities under pressure.
“At the end of the day, staffing is as much a risk management issue as a business one,” said Ralph Schiller, Senior Broker at Homewood Insurance. “Operators who get ahead of this challenge will be in a stronger position when it comes time to renew coverage.”
