Placing You First Insurance Podcast by CRC Group
The Placing You First Podcast spans a diverse spectrum of insurance industry issues to keep you and your clients informed.
Placing You First Insurance Podcast by CRC Group
Healthcare Facilities Update, Coronavirus, COVID-19
Coronavirus (COVID-19) is now widespread in the United States. CRC Group Healthcare specialists discuss what the current insurance situation looks like for Healthcare facilities, and what the future will bring. They comment on COVID-19 exclusions and if they will hold up in court. Also, they cover reporting Coronavirus to carriers and the likelihood of lawsuits for Healthcare facilities that experience an outbreak. Finally, the team discusses Carriers changing the way they underwrite around the epidemic risk, and what are critical factors for insureds that are up for renewal in the near future?
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Featuring:
Tom Levin, CRC Chicago
Rusty Hughes, CRC Birmingham
Corey Daugherty, CRC Birmingham
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Dan Wentz:This is the placing you first podcast. I'm Dan Wentz, and this podcast features news and insights from CRCs vast knowledge base of 600 plus producers who write in excess of$8 billion in premium annually. And we're giving you insider access to what's happening in our company and the current trends in the types of insurance we place on this edition of the podcast.
Tom Levin:Just about any underwriter you ask them, their greatest fear is the unknown. And we're in a time when there's a lot of unknown about Corona virus and eventually what type of litigation we're going to see. But I think the adding of these exclusions is a way that carriers are trying to upfront define their position.
Dan Wentz:This is the placing you first podcast. Okay, so we're back with an update on healthcare facilities and today I'm joined by three of our specialists from CRC group, Corey Dardy, who's a broker here in the Birmingham Alabama office along with rusty Hughes is also of course a broker and[inaudible]. Tom Levin joins us from Chicago, which has a lot going on with the Corona virus and the coven 19 situation right now. So the last time we talked Corona virus was kind of new and we were just learning the extent and what the impact here in the United States was going to be. We had heard that, you know, China was bad and everything, but now it's kind of taking a grip here in the U S and so we've got a lot more information to share with you about health care facilities and I guess we'll start with Tom today. Tom, how do you feel that healthcare facilities are responding to coven 19 so far?
Tom Levin:Thanks Dan. I think it's really been remarkable. We are healthcare facilities, hospitals, longterm care facilities, physician groups, so on and so forth have really been stepping up to the challenge of taking care of our communities. It hasn't been easy and there's still a lot of work left to be done, but from what we can tell, all the various organizations out there are really doing everything they can to put their best foot forward.
Dan Wentz:Yeah, we're seeing some, some new responses to this with regards to insurance and how this is hitting right now and people were kind of adapting to this specifically. Is there, has there been any changes with doctors going towards a telecom, telemedicine or virtual office visit kind of situation? Is that what you guys are seeing?
Tom Levin:Yeah, by and large we've seen a pretty strong pivot away from visits in person for anything that's not absolutely essential. Um, and various providers around the country who have really stepped up. Um, they're adapting and finding ways to continue to reach their, their patient base. Um, and so we've been getting a lot of requests to add telemedicine type exposures onto current accounts and we've seen some new risks come in the door for us in the telemedicine realm, uh, that need insurance because it's a new exposure for them.
Rusty Hughes:No doubt about that. Dan, this is rusty. I, uh, thanks again for having us today. Uh, glad to be here. Um, I would say I would agree with what Tom said, that's particularly become evident in the senior living setting just because, particularly around wellness visits with the population that is currently residing in the senior living facilities in the United States. I would say that wellness visits have become almost a routinely done by telemedicine.
Corery Daugherty:And Dan, this is Corey. I would also add to that that, you know, the, uh, the marketplace, I think this is one area in the industry where I think the marketplace has shined and has been responsive to this kind. Like most of the carriers that write health care to some degree have a book of telemedicine business already on their portfolio, in their portfolio. We have seen thus far and extremely excitedly to their clients moving to this model to avoid catastrophic issues if they are not able to Mesa.
Dan Wentz:Yeah. So you mentioned the, uh, the carrier response to this. What are we seeing is as far as how the carriers are responding to coven 19?
Corery Daugherty:Say that it's been, it's been mixed. Um, if you look at the industry right now here in the United States, you know, we've got a list of, you know, probably 10 to 12 carriers that have at this point taking the position that they're going to issue a moratorium on new business. That ranges anywhere from I would say 30 days or 90 days depending on carry in the product. Um, and then we've got another probably 12 to 15 carriers that have already introduced some level of a, either a communicable disease exclusion or taken a restrictive coverage position around the exposure in general.
Dan Wentz:And obviously those exclusions, there's some, some gray areas surrounding them as to whether or not they're longterm viable. Is that right? Can you talk a little bit about that?
Rusty Hughes:I w I would say the, the, that's the great debate right now I think is what will the industry do with regard to covering coven or not covering cause and we've had some discussions internally where there are carriers that are beginning to put explosions on renewal business. Let's say that you have a renewal that's coming up in the next 30 days and you can anticipate that a certain carrier that you may be with is going to add an exclusion for COBIT. So, um, we, we're, we're having to be really mindful of that. But that brings into question, well, and it's really for, uh, it's really a great discussion as well. These carriers that are attaching COBIT exclusions, does that mean that they believe it's currently covered? I mean, well, why do you feel like you need to attach a covet exclusion to a policy that doesn't currently have one? I mean, that's an open ended question, but, uh, I'd love Tom and Cory's opinion on that. That's one of the things that I've been asked, you know, why do they feel the need in the current time knowing that the risk is out there? Is that telling us that they think there's going to be coverage debates on current currently enforced policy?
Tom Levin:I think you hit the nail right on the head there, rusty, just about any underwriter you ask them their greatest fear is the unknown. And we're in a time when there's a lot of unknown about coronavirus and eventually what type of litigation we're going to see. But I think the adding of these exclusions is a, that carriers are trying to upfront define their position. I personally questioned in a court of law whether these endorsements will hold up or not. I think from an insurance perspective it feels a little bit predatory when you have a carrier that's going to exclude what might be your largest risk at the given time.
Corery Daugherty:I agree 100% Tom, and it's one of those points that we've had discussions and dialogue around since the beginning of the pen demo, you know, a couple of weeks ago. I mean, you know, in the senior living setting there are residents that their health is compromised already and we have, and our, our clients have individuals in their facilities that are diagnosed with the flu pneumonia on a daily basis. In a lot of ways. We've had conversations in the parent dialogue. No. While this is a much broader scope and it's 10 demic level, we've never seen the industry respond to the flu. The way that we clean them, respond to this. I don't think regardless of whether the exclusionary language holds up in a court, once it starts to be litigated, I think that the ripple effects of the industry is going to be astronomical. Just due to be a mouth and descent the carriers are going to have to incur in trying to prove and or to stand their position in a court of law.
Dan Wentz:Yeah, and you mentioned that this is sort of unprecedented. One of the questions is do you provide carriers notice of coven 19 and what is, you know, what are the issues surrounding that right now? If you, if you have a case of coven 19 year facility,
Rusty Hughes:that's a hot topic right now. I mean that, that's one of the biggest, what do we do type questions, particularly if you have a facility that has multiple cases of it. I mean what, what, what do they do? They almost feel, I mean there's a sense of being overwhelmed. So some degree like Tom, I would love to hear your point of view. You know, you're in a, you're in a larger more metropolitan areas. There's more of a wider reach. And Tom and I were discussing this morning, uh, in a separate conversation about, uh, certain facilities in that region that are experiencing just that right now.
Tom Levin:But what are you doing? Where I've settled for now is we're advising all of our agents, if you do have a facility that has a positive test and either a resident or an employee, give us a call and consult with us and we'll determine the best course of action. We want to make sure with each of the carriers that they will accept a positive test as a reportable incident under the policy. Just this past Friday, we actually had our first in my positive test at one of our facilities, I reached out to the director of claims for that character's very trusted partner of ours and that claims manager said, absolutely, go ahead and report it as an incident. Err on the side of caution. And let me know how we can be of support during this time. I thought it was a really great response. I appreciate it as did my agent. But it's a long way of saying I think it's really case by case, situation by situation and if it does come up, call your broker at CRC and work through it. I agree
Corery Daugherty:100% with that and I think that transparency and communication is the key. Um, I think the four or five carriers that write the majority of their senior living business, uh, have resources that are available to their clients from a risk management perspective. I think most of those carriers are well-versed from a risk management perspective. And I think that by making notice of an incident or you know, of course making them aware you do have a positive test and you're building, I think that just opens the door of communication even more so and allows that carrier and their risk management partners and vendors to work with that facility to help mitigate the spread and the violence throughout the facility and other facilities in that area.
Tom Levin:Have you seen any examples of this leading to litigation so far? Yeah, sure. There was a, um, there's a facility in the Chicago land area that's, that's had an outbreak and has uh, quite a few effected residents and uh, you know, I went to Google to kind of look and see what was going on and I did a search and the first thing that popped up was an ad for a plaintiff attorney firm and it's a very well known firm here in the Chicago land area. And so we have a lot of questions as to whether the coronavirus is going to lead to litigation. That kind of answered that question for me, that the plaintiff's attorneys are out there and they're going to be targeting these facilities, whether anyone will find any kind of negligence or liability remains to be seen. But I do think we should anticipate we are going to see lawsuits coming out of these types of situations.
Rusty Hughes:Tom, I think that's the tough part about where we sit is we already have a nervous client base who is trying to deal with something that none of us ever really thought that we would. I mean this is not what we pictured as the next risk in health care, right? I mean we, we've always talked about the unknown climate. We never really thought we'd be here. Can you imagine now these clients trying to deal with, you know, who does or does not have coven in their facility and then all of a sudden request from lawyers start coming in already in the midst of it as they're trying to take care of their fine. Also in our group we talked about reverting back to the questionnaires that some of these carriers are requiring of these clients for both renewal and new business. And really if you think about it, you have a subset of 15 carriers that are kind of controlling the market right now. And most of them are requiring their questionnaires and some of them are a little bit different, you know, and it all boils down to, I was talking with an underwriter the other day who kind of has a different view. He said, you know, we could boil it down to one question on the app really and just say, Hey, do you have sick people under your care? That's really what we're talking about in these, I agree with Tom. It is a little bit predatory at this point for applying this bar to began doing what they're doing.
Tom Levin:Yeah, I think it, just to tack onto that, you know, we've done conference calls with a few clients with our agents and at this point in time these facilities are in overdrive trying to figure out a way to keep their residents safe. And then we're going to ask them to talk about insurance, which tends not to be anybody's favorite topic in normal times. And now we're going to talk about doing coronavirus questionnaires and warranties and how does my coverage apply? It's the last thing in the world these folks wanted, want to hear about. So I think we're, um, it's difficult to be empathetic, but we can definitely be sympathetic with their situation. Our key underwriters, I think our understanding of that as well and are trying to make things as streamlined as possible for our insurance, especially those that are coming up for renewals here in April. And may,
Corery Daugherty:Tom, to your, to your point, just over the weekend, there was an article here in Birmingham that came out where Alabama's had their first cases in Alabama, senior living facilities and the city of the Alabama nursing home association said in the article that in our lifetime, and there's never been a greater threat to our mercy vulnerable citizens than the threat brothers back cause in 19 two the residents of our nursing homes. So I think that that statement alone speaks volumes to the situation your operators are in. Right now I'm trying to be as proactive as they can and mitigating this pandemic, which as we've all said and something that we have never seen before in our careers.
Dan Wentz:Yeah. And there's some issues that maybe aren't as a parent to begin with. Like do you report employees as part of your policy? I mean we've got to think not only about the residents but also about the people that work there. Right? So is that reportable?
Tom Levin:When we are faced with that question it will happen. We will have that situation arise. Again, it's going to be case by case. I think we'll get differing opinions from some of the carriers out there, but I can guarantee we'll definitely engage them with dialogue on the subject.
Corery Daugherty:I think that that's what comes such a hot button as it relates to employees because some of the trends that we've seen in hot pocket menus across the country where there has been a more significant outbreak, continued living facilities, and it's the thought that a lot of these employees that work in these buildings are dual employed and they're working for different operators. They're working, you know, one day in one facility, a second day and another facility. Um, so I think that it's imperative that operators did the best that they can on trying to determine and figure out when, where their employees are working to again found that control the spread of this thing.
Dan Wentz:How do you guys see this playing out as far as new business goes?
Tom Levin:Well, I think that the flow of new business is going to change. I think that, you know, our retail partners aren't out prospecting right now and so you can expect some sort of a slow down. But what we've found really in about the last since about last Wednesday or Thursday was an uptick. But folks who've got renewal quotes that have a problem with carrier attaching a coven, 19 exclusion carriers are having heartburn and, and uh, increasing prices to untenable amounts. So I think our, our new business is going to change. It's going to be different[inaudible] typical. But I do think we'll remain very busy. We're also starting to get calls on new, what I would refer to is covert 19 related exposures. For example, we've gotten a couple of calls on these quote unquote mash hospitals that are going to be put in place to help with overflow in any given community. Um, we'll see what happens. I think our renewal retention, it's really important right now wherever possible. I think we're looking find quality renewals instead of moving coverage. But it remains to be seen.
Rusty Hughes:I think the new business flow will, it will quote ebb and flow. I guess we're going to, we're going to see sort of a up and down kind of cycle that we're going to go through. But I think now it's more important than ever to have really, really educated discussions with clients about checking all the boxes. If you do move coverage from one carrier to another at renewal, because most of the stuff we're dealing with these claims might coverage, particularly in the healthcare setting. Really the conversation becomes what is a known incident? What is, what cannot be a known incident is, is you know, is a coven test that's out there that's not yet come back considered a reportable incident. If you want to move to another carrier, you know, we don't all know the right answers for that right now. But uh, you know, now more than ever, it's really time to, if you have a client that is dissatisfied with their current renewal placement, you got to really have an educated conversation around, all right, this is what we must do if we move covers now more than ever.
Dan Wentz:And what kind of issues are we going to see at renewal? Like what do we need to be working farther ahead now? Or what is the strategy for renewal right now?
Corery Daugherty:Yeah, I think that, you know, yes we need to do the best we can to try and get way ahead of renewables. But one of the trends that I've seen with a couple of carriers is due to the pandemic due to the crisis, even the uncertainty surrounding it, we've seen some carriers take positions that they will not leave renewal quotes more than 30 days prior to the expiration date of the policy. So as much as we as brokers would like to get, you know, an early jump on renewals and placements. I think that we're going to see more and more carriers potentially starting to take that same position. Um, and we need to be ready to go right at that 30 day Mark.
Tom Levin:We want to work early and we want to be cognizant but we also know[inaudible] what we're learning about Cobin 19 changes daily and so we don't know what the marketplace is going to look like. 60 90 120 days from now. We know it's going to be a challenge and we need to be communicating with our clients. But like Corey said, I mean we, I don't think we can try to rush into anything cause that's not going to yield positive results. Another issue there is for some of the larger, more complex accounts like hospital systems who have large, sir, they have a lot of furloughed workers right now. A lot of people who are involved in the process of gathering information, doing reserve meetings for SII, RS, putting together funding studies. They're not working right now. They're not permitted in the hospitals. And so it's going to be difficult to get that renewal information in. And in those situations we're going to probably be looking at aiming for about three month extension.
Dan Wentz:I think it's absolutely crucial right now for our agents to be in touch with their CRC broker. What do you guys bring to the table is far as how you can help them right now with everything they're dealing with?
Rusty Hughes:I think the answer to that is pretty simple. Our health care group at CRC, we talk daily. We've been on the phone with each other, asking advice saying, Hey, what would you do in this situation? Here's what I've got. I've got an agent asking me this question. I've got an insured who doesn't know what to do and we are really, really good about communicating well with one another and round titling. How about those exposures? So I think that's really what we bring to the table is a unified approach. I think what you'll see is us pushing out communication to the market that[inaudible] very consistent. It's very concise and I think that we as a group are making good decisions around exposures. I agree 100% rusted. I think that the end of the day it's a relationship business and I think there has to be a practice group, um, over the years has developed strong relationships with the leading carriers in the space. Um, and I think that the healthcare practice[inaudible] you know, it has taken the all boats drives with the top approach and we're looking at this as a collective effort to try and help our retailers, um, you know, work through this best we can with policy holders and clients.
Dan Wentz:Corey, Tom and rusty. It's been great as always great information and I did want to take this opportunity to mention that we have a webpage set up@crcgroup.com totally focused on the latest news from CRC group regarding coven nineteens, just CRC group.com/coven 19 that'll get you there. Or slash Corona virus. We actually have them all working right now. So yeah, head there for the latest updates and I'm sure we'll be checking back in with with our brokers who are focused around healthcare facilities in the near future. To get an update again on this as this coronavirus you know pans out. We learned more and more everyday about this but thank you guys very much. We appreciate you being a part of the podcast today. Thanks for having me Dan. So placing you first podcast as the situation with the Corona virus develops impacting normal daily life insurance across the country are in a state of uncertainty. CRC group is committed to doing whatever we can to help you and your clients@crcgroup.com we have a webpage specifically devoted to COBIT 19 Corona virus. It has all of our tools, Intel podcasts and industry leading white papers on the virus visited today by clicking the link on our homepage or visiting CRC group.com/cobit 19 and also keep up with us on LinkedIn. Do a company search for CRC insurance services and follow us there. We have a YouTube channel. Look for CRC group and also for the podcast. Make sure you hit that subscribe button so you never miss a new podcast entry. We appreciate you listening to the placing you first podcast. We'll talk to you next time.
