The jump has not been specific to any one area, he added, noting that Burns and Wilcox “sees business coming in from branches all over the country.”

Mr. Derigiotis said he saw skilled nursing facility risks coming in at first, but observed there has been a transition to home health care as many in the aging population have decided they do not want institutional care if they can possibly avoid it. “People want to stay in the comfort of their own home,” he explained.

As for the risks in writing home health care business, Mr. Derigiotis said the niche poses many of the same exposures as skilled nursing facilities–claims for injuries or patient abuse carry over into home care.

The excess and surplus lines market has been so aggressive in going after this business that Mr. Derigiotis said he does not believe the soft market will ever subside. He said some standard markets are even entering the competition for these risks, adding that E&S carriers have “a tough time competing against them.”

That's a symptom of the soft market in general, according to Mr. Derigiotis.

“Admitted markets are gobbling up risks better fit for excess and surplus, like this,” he said.

Brian Lindahl, senior vice president in Brown & Brown's Daytona, Fla., office, said “the market is as soft as I can remember it being in 15 years–maybe longer.” He added prices are “down dramatically” in multiple states, and there is plenty of capacity.

Today's abundant capacity and competitive pricing for eldercare risks is a dramatic shift from the late 1990s, when a challenging legal environment chased most insurers from the niche, according to Mr. Lindahl. Using Florida as an example of what was also occurring in other states, he recalled that the lawsuit issues worsened throughout the 1990s and reached a peak late that decade.

For insurers, he said, “loss experience went from good to awful.” Many carriers exited the marketplace, with some large ones that were active in writing eldercare risks–such as Continental, St Paul, The Hartford and Lloyd's–feeling the brunt of the losses, he noted.

Tort reform laws in Florida and other states have since helped the insurance market recover, encouraging carriers to re-enter the marketplace, explained Mr. Lindahl, who added that eldercare facilities have emerged from the hard times as better risks. After having managed their own claims, many facilities now understand insurance and are better partners, he noted.

They are, he said, in tune with the services provided by insurance carriers and brokers, and work more effectively with their insurance partners.

Mr. Lindahl said the E&S market will typically take up professional and general liability for skilled nursing homes, continuing care retirement communities and assisted living facilities. Even when standard markets do write liability coverage, he added, they do it on nonadmitted paper.

Other coverages for such facilities–such as auto and property insurance–may find a home in the admitted market, Mr. Lindahl said, noting that property in particular is considered to be a good risk, as someone is on the premises 24 hours a day, seven days a week, and the properties are scrutinized by state regulators such as the Agency for Healthcare Administration in Florida–which requires property safety surveys.

Such surveys are “almost like an underwriting tool for insurers,” he said.

He added that buildings are usually built to good code–resistant against catastrophes where they need to be–and almost every state requires full sprinkler systems.

Auto risks, Mr. Lindahl conceded, are a bit harder to place, while noting that some boutique carriers will write them, as well as standard carriers such as Fireman's Fund.

Workers' compensation has “gotten a lot better” at underwriting these facilities, according to Mr. Lindahl, as nursing homes have implemented programs that have reduced loss severity. He specifically mentioned reducing reliance on manual lifting of the elderly.

Professional liability is the biggest risk for skilled nursing homes and continuing care retirement communities, warned Mr. Lindahl, as they deliver a high level of care to residents. Professional and general liability will generally be written under one program, with the other coverages placed elsewhere, he said.

For assisted-living facilities, professional liability coverage is not as big a factor as it is for skilled nursing homes and CCRCs, Mr. Lindahl explained, because the residents leave the assisted-living facilities and go to nursing homes when they need that level of care. Assisted-living facilities pay about a third of what nursing homes and CCRCs pay for liability coverage, he noted.

Independent living facilities have no professional liability exposure, according to Mr. Lindahl, as the front desk will dial 911 in the event medical assistance is needed. However, he warned that there is not a lot of capacity for independent living facilities because they are “sort of in nowhere land”–between the insurance markets for eldercare facilities and markets for apartments.

The slumping economy has had different effects on each type of eldercare facility, Mr. Lindahl said. For nursing homes, he noted that 65-to-70 percent of revenue is Medicaid-driven, and so they are “more isolated from upturns and downturns” in the economy. However, he warned that they have to live within the annual budget cycles in their states, which can be easier or more difficult depending on the state.

Burns & Wilcox's Mr. Derigiotis said some of these types of facilities are struggling to get Medicaid dollars from state governments in this economy, making it harder for them to keep their doors open.

CCRCs and assisted-living facilities have been most heavily impacted by the economy, according to Mr. Lindahl. He explained that people have to sell their homes before they move into such facilities, and that has been complicated by the troubles in the real estate market.

These facilities have been able to weather the economy, says Mr. Lindahl, because they have a backlog of people waiting to get in. But things could get worse for them, he warned, if the recession continues and the waiting lists start to dwindle away.

CHILDCARE RISKS

At the other end of the age spectrum in the social services market–child daycare facilities–Mr. Derigiotis said he has not seen a big impact from the economy for special needs daycare (the type of business written by Burns & Wilcox in this niche) because it is more specialized and in line with the appetite of the carriers with which the wholesale broker deals.

Standard daycare facilities, however, are feeling the effects of the sluggish economy, according to Christi Hatcher, managing director of underwriting for Markel Specialty. She said the economy has affected areas such as staffing at daycare facilities for maintenance.

Additionally, she said “we see very little organic growth in the size of accounts.” There are few new businesses, she said, and Markel is noting declines in enrollment, with some accounts closing their doors.

Some camps are developing new activities to attract clients, and these may be activities the facility has not attempted before, noted Ms Hatcher. This could affect underwriting, she said, adding that Markel can provide underwriting support when camp directors, associates and counselors have knowledge and training in these activities.

Staff turnover is another concern, she said, since “camps that devote time and training to new personnel end up with the benefit of having a safe, quality environment for campers.”

Still, despite the effects of the economy, Ms. Hatcher said the soft market has led to continuing competition for these risks.

“We've seen additional new players in the past few years,” she said, “and while we see new competitors, they may not all be as committed to these youth organizations as Markel has been and will continue to be in the future.”

She added that “we encourage agents and policyholders to focus on value and not only price, including financial strength, ability to pay claims and experience in understanding sensitive claims that involve organizations that serve children.”

Looking forward, Ms. Hatcher said, “I would hope the market stabilizes, but so far we continue to see strong competition.”