This article was produced in partnership with Markel Care.
Bethan Moorcraft, of Insurance Business, sat down with Meenu Nair, director of Markel Care, to discuss the importance of insurance in Canada’s care sector.
The COVID-19 pandemic has had a huge impact on Canada’s care sector. Throughout the coronavirus crisis, care organizations have been on the front line of protecting the most vulnerable people in Canadian society – and they’ve kept their organizations running despite tumultuous insurance market conditions characterized by sky-high rates, coverage limitations, and shrinking capacity.
As society reopens and COVID-19 restrictions are removed, the challenges in the care sector are not going to disappear overnight. In fact, indications point to a rise in Canadians seeking solutions for mental health, wellbeing, and companionship. There has also been a rise in the number of rehabilitation centres, counselling services, shelters, domiciliary care, and assisted living organizations – all of which are seeking insurance solutions from a hard marketplace.
Any individuals or organizations looking to provide care must ensure they hold adequate insurance coverage and limits of indemnity for their unique risk profiles.
“Canada has a diverse landscape, regulatory, and licensing environment for profit and non-profit organizations,” said Meenu Nair, director of Markel Care, a sector specialist providing insurance and non-insurance solutions for organizations that provide supervision, support and care for young, elderly, vulnerable and disadvantaged members of society. “There is an assortment of factors within a client profile that makes it unique […] and thus there is no one-size-fits-all insurance solution.”
Markel Care launched in Canada in 2020, following the successful establishment of the unit in the United Kingdom. Taking the lessons learned from the UK, Markel Canada worked to implement best practices and to duplicate the Markel Care product success, making appropriate modifications for the Canadian landscape.
The Markel Care policy is a packaged insurance solution that can be built on a modular basis. As a minimum requirement, policyholders must buy general liability, after which they can purchase additional coverage, including abuse (claims-made or occurrence), errors & omissions (E&O), directors & officers liability (D&O), property, crime & legal expense. Clients requiring higher limits can also purchase excess & umbrella coverage.
The importance of abuse (claims-made or occurrence) coverage cannot be understated in the care sector, according to Nair. In recent years, abuse claims have become more widespread – and with added stressors like the COVID-19 pandemic, the cost-of-living crisis, and declining levels of mental wellbeing across Canada, abuse is an exposure that every care provider has.
Nair emphasized: “We often think of abuse being sexual in nature, but verbal and physical violence, mental and financial abuse all can occur with the clients that fall within the care sector.”
Abuse claims often arise years after the alleged event happened, highlighting the need for care providers to have a claims occurring policy over a claims made policy. A claims occurring policy would cover an organization in the event of a claim irrespective of when the claim is made, giving the policyholder long-term protection. In contrast, claims-made policies only cover the policyholder for incidents that happen and are notified during the period of insurance. When moving from different abuse forms, this can create gaps in coverage, which can be solved with retro abuse coverage, subject to underwriting information.
The Markel Care policy includes abuse coverage (claims-made and occurrence) with primary and excess limits both available up to $5 million. The solution also comes with risk management services (including specialist consultancy services, legal assistance, and premium financing) to help insureds, at no additional cost, to achieve best practices in care and to identify and mitigate any potential liability, including events that could result in abuse claims.
“The most effective risk mitigation strategies are those that are practiced knowingly,” Nair told Insurance Business. “The client needs to understand what risks they choose to accept, avoid, transfer or reduce. Each risk strategy has its own benefits and drawbacks and also its own procedures and processes that work to mitigate the overall risk.
“When the clients being serviced are vulnerable by nature of age, physical ability, or socio-economic status, they are more likely to be victims of abuse. At Markel Care we can help our clients to prevent and reduce the opportunity for abuse. We provide bespoke strategies to address each client’s individual needs and situations, however, we believe it all starts with good hiring practices, training, and robust policy and procedures in place that are implemented and followed.”
Markel Care is well-positioned to continue delivering best-in-class insurance and risk management solutions to Canadian care providers in a challenging post-pandemic environment. Nair said the unit’s success derives from its “specialization,” alongside the flexibility and architecture Markel Care has in place to provide the necessary service broker partners and clients.
She added: “Markel’s Care underwriters are the experts in this sector, and they are the one point of contact for the clients’ insurance solutions. Even with our disciplined underwriting and risk management strategies, claims are still inevitable. The vulnerable nature of this sector can make the claims complicated, sensitive, and difficult, which warrants specialized claims handling by our expert claims examiners.
“Specialization is key to this unique sector from underwriting to maintaining, to claims handling – and everything must be treated as such to ensure success.”
