# Presentation: 220293

## Professional Liability InsuranceNotice H 04-15

- Department of Housing and Urban Development
- Office of Multifamily Development

- HUD Notice H 04-15

## Introduction

- Overview of Presentation
- Introduction of Panelists
- Discussion of Changes
- Presentation of Industry Professionals
- Question and Answer Session

- HUD Notice H 04-15

## Rating Providers of Insurance

- Liability Insurance must be Rated by AM Best with a B++
- Rating Captives & Risk Retention Groups
- Offshore Insurance Providers Prohibited
- Approval of Additional Rating Agencies

- HUD Notice H 04-15

## Joint Underwriting Associations

- What are JUAs
- HUD Approval of JUA providers of Professional Liability Insurance
- JUAs in Operation Less than four Years
- Disqualification of JUAs

- HUD Notice H 04-15

## Operator/Manager of Healthcare Facilities

- Definition of Operator/Manager
- Corporate Operator/Managers

- HUD Notice H 04-15

## Financial Statements

- HUD Needs Audited Financial Statements for Operator/Manager
- HUD will Accept Operator/Manager Certified Financial Statements in lieu of Audited Financial Statements

- HUD Notice H 04-15

## Submission of Claims Information

- Incident Reports for Serious Injuries
- Insurance Loss Reports must be Submitted
- Inventory of Claims must by Provided
- State Licensing Surveys must be Provided for all G Rated or Higher Deficiencies

- HUD Notice H 04-15

## HUD Review of Insurance Needs

- HUD will Review Information Prior to Submission of Application
- HUD will Provide Guidance of Insurance Needs

- HUD Notice H 04-15

## Surplus Lines Carriers

- Licensed Carriers Acceptable
- Surplus Lines Carriers also Acceptable from HUD as Long as they have Authorization to Conduct Business in the State

- HUD Notice H 04-15

## Insurance Tail Coverage

- Tail Coverage is Required if Claims are the Responsibility of the Operator/Manager
- No Tail Coverage if Property is being Purchased and Prior Claims are not the Responsibility of the New Operator/Manager

- HUD Notice H 04-15

## 223 A(7) Refinancing

- If Applicant has Adequate Professional Liability Insurance, Requirements of Notice H 04-15 will _NOT_ Apply

- HUD Notice H 04-15

## Troubled State Designation

- Designation of Troubled State is Eliminated
- HUD will Review Each Applicant Where High Insurance Costs Impacts the Feasibility of the Project

- HUD Notice H 04-15

## Minimum Coverage and Deductibles 

- Minimum Insurance coverage is $1,000,000/$3,000,000
- HUD may Lower Minimum Coverage is Application is Infeasible Due to Insurance Cost
- Deductible Raised to $100,000
- Maximum Deductible is $1,000,000 for Operator/Managers with 50+ Facilities

- HUD Notice H 04-15

## Hamilton Insurance Agency

- Presentation of Alan Zuccari of Hamilton Insurance Company on Industry Perspectives of Revised Notice
- Review of Issues that Insurance Underwriters Focus on When Conducting Due Diligence of Healthcare Facilities

- HUD Notice H 04-15

## Questions and Answers

- Panel:
- Michael McCullough (HUD)
- Alan Zuccari
- C. Mark Williams (HUD)
- Minnie Monroe-Baldwin (HUD)

- HUD Notice H 04-15

## Final Comments

- Final Comments from HUD STAFF
- Discussion of Next Steps in Training Process for Professional Liability Insurance Issues

- HUD Notice H 04-15