WAC Update: Commercial and Professional Liability Insurance Requirements

During the quarterly RCS-AFH Provider Forum on November 15^th, Colleen Jensen, the RCS AFH Policy Program Manager, shared that there is a new requirement for AFHs to have both commercial and professional liability insurance. We’ve received several calls and emails where providers are confused about these requirements. This is not a new requirement. The requirement for AFHs to have both professional and commercial liability insurance has been in place for years, however, the WACs were just updated in August, 2023 to clarify this requirement.

So what does this mean for providers?

You are required to have liability insurance that covers the business (commercial) AND you and your staff (professional). Professional liability insurance is required for all caregiver types, regardless of the credential. This includes HCA, CNA, LPN, RN or ARNP, etc. Most insurance companies that provide liability insurance to AFHs are aware of these requirements. We suggest reviewing your policy or contacting your insurance company to ensure you have a policy that meets the regulatory requirements.

Here are the WACs for reference:

WAC 388-76-10191

Liability insurance required.
The adult family home must:

(1) Obtain and maintain both:

(a) Commercial general liability insurance or business liability insurance covering the adult family home; and

(b) Professional liability insurance or errors and omissions insurance covering the adult family home.

(2) Obtain the liability insurance required in subsection (1) of this section before whichever of the following events happens first:

(a) Admitting the first resident after issuance of a new adult family home license; or

(b) 10 working days have passed since the issuance of the license.

(3) Have evidence of liability insurance coverage available if requested by the department.

(4) Notify the department’s complaint resolution unit if there is any lapse in required liability insurance coverage.

WAC 388-76-10192

Liability insurance required—Coverage requirements.

(1) The liability insurance coverage required under WAC 388-76-10191 must include:

(a) Losses or allegations or both caused by errors and omissions of the adult family home or its employees or volunteers;

(b) Coverage for bodily injury, property damage, and contractual liability; and

(c) Coverage for premises, operations, products-completed operations, personal injury, advertising injury, and liability assumed under an insured contract.

(2) Each of the required liability insurance policies must cover a minimum limit of:

(a) Each occurrence at $500,000; and

(b) General aggregate at $1,000,000.

(3) The liability insurance policies must indemnify, hold harmless, and provide insurance coverage for the State of Washington, the department, its elected and appointed officials, agents, and employees of the state for any and all claims, losses, liability, damages, or fines arising out of the acts or omissions of the adult family home licensee, its staff, contractors, and residents. The State of Washington, the department, its elected and appointed officials, agents, and employees must be listed as additional insureds on all insurance policies relating to the operation or premises of the adult family home.

(4) If the home serves residents whose care is paid for by medicaid, the medicaid contract may require a higher minimum insurance limit.