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Care providers witness near 20% increase in insurance costs during pandemic, survey finds

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Care providers have seen a near 20% increase in the cost of insurance since the start of the pandemic, with some reporting that insurers are refusing to quote them, or pulling out of the care sector entirely.

A survey of 98 care providers conducted by the Care Provider Alliance (CPA) in September found that 70% had seen an increase in the price of insurance this year compared to what they paid in 2019.

On average, there has been a 19% increase in the cost of insurance in 2020, and a 31% increase in costs since 2018.

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Nearly half (48%) of respondents said there had been exclusions or restrictions applied, with COVID-19 being the main issue affecting public and employers’ liability and professional indemnity insurance.

Providers also reported a decline in the number of insurers in the market with some insurance companies refusing to quote, or pulling out of the sector entirely.

The CPA said that as of September 2020, the potential risk of claims being brought to them in relation to COVID had not been fully considered, with most providers trying to continue with business as usual until such a time as this becomes an issue for them directly.

It warned that such an approach poses a “significant risk” to providers and the sector as a whole.

“Should there be the event of a class action, or a successful claim setting a precedent for future claims, the care sector as it stands will be significantly exposed,” the organisation explained.

The CPA has been advised by insurance brokers that it is becoming common practice at the point of insurance renewals for care providers to be asked to complete a questionnaire on their infection control practice and to advise of the likelihood of any claims that they are aware of which may arise during the period of the insurance.

There is also emerging evidence that providers who do not follow the guidance on PPE may have issues with invalidating their insurance.

The CPA has raised these issues with colleagues at the Department of Health and Social Care as part of its ongoing work to ask for indemnity for care providers.

It said: “The Care Provider Alliance is asking the Department for Health and Social Care to set up an indemnity scheme for the social care sector equivalent to that provided by section 11 of the Coronavirus Act 2020 in combination with other NHS indemnities, for health service providers.”

For more details on this survey, and for information on the legal and regulatory risks and liabilities that may arise in relation to Covid-19, click here.

Government response

A question was asked in the House of Lords recently by Baroness Hayman of Ullock, Shadow Spokesperson for Environment, Food and Rural Affairs, on what progress the government have made in ensuring care providers are granted insurance indemnity under the same terms as provided for the NHS under the Coronavirus Act 2020.

In reply, Lord Bethell, Parliamentary Under-Secretary for Health and Social Care, said: “We recognise that the adult social care insurance market is changing in response to the pandemic. We are working closely across government, with care providers and insurance representatives to understand the breadth and severity of the issues, and whether there is any action the government should take to support the sector.”

Tags : Care Provider Allianceinsurance
Sarah Clarke

The author Sarah Clarke

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