Care homes fear closures as insurance costs soar

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Care home in Scarborough, North Yorkshire

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Representatives for the sector say insurance costs are “astronomical”

Care home owners whose insurance premiums have soared this year have called for government protection from being sued over coronavirus deaths.

Care England warned the situation was an “an absolutely enormous threat” to the future of the sector.

Owners said they feared they could go out of business if they were not offered similar indemnity to the NHS.

The government said it was doing everything it could to support the social care sector.

Care England, a charity that represents providers across the country, said if care homes could not get insurance they would not be able to take patients with coronavirus from hospitals.

‘People need to be cared for’

Mike Padgham, managing director of St Cecilia’s care group in Scarborough, North Yorkshire, said he was shocked to be told renewing his existing policy would cost him 880% more than last year.

He previously paid £10,000 but his quote for renewal was initially £98,000. He received an alternative offer of £41,000 and finally settled for a policy costing £18,000.

“I do have some sympathy with the insurance companies because they’re worried about the risk, which is why I want the government to step in and help the industry,” he said.

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One care home owner was shocked to discover his insurance might rise by 880%

Mr Padgham has written an open letter to the health secretary calling for government intervention.

“I’ve had some sleepless nights over it,” he said.

“We don’t have to do this job, of course, but somebody has to provide the care because people need to be cared for.

“Providers like ourselves are playing a part in that, but we want the government to help us in that drive and if they’re true to their word, we are all in this together, then they should be helping us.”

‘Astronomical’ increases

There have been outbreaks of Covid-19 in about 44% of all registered care homes, according to Public Health England figures.

The National Care Association, which represents small and medium-sized care providers, surveyed all of its members regarding insurance.

It received 68 responses, with 68% reporting an increase in their premium and 35% changing provider.

Almost all respondents – 93.5% – said they had no Covid-19 cover included in their renewal.

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Care providers fear rising insurance costs will limit their services or put them out of business

Care England’s chief executive Martin Green said: “This is an absolutely enormous threat to the care sector and I think we should acknowledge that some of the increases in costs are absolutely astronomical.

“We’ve seen people who used to pay £12,000 being told they have to now pay £98,000 and also will get less cover than they used to get.

“So, faced with that situation, businesses are going to have to either find that extra money or in many cases they won’t be able to function and they’ll go out of business.”

During the early stages of the coronavirus crisis, government legislation was brought in giving additional protection – or indemnity – to the health service.

However, those measures would not apply to care homes.

Mr Green added: “The reality is that social care and the NHS are inextricably linked and we all support the same people.

“So I don’t see why the government should make an exception and deliver indemnity for one part of the system and totally ignore the other.”

A Department for Health and Social spokesperson said: “We are doing everything we can to support the social care sector during this unprecedented pandemic.

“We are working closely across government, with care providers and insurance representatives, to understand these issues and any action that may need to be taken.”

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