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  • Ronald R. Hagelman, Jr.

Dragon Slayer

Updated: Sep 24, 2020


The Senior housing market in terms of national ALF and NH occupancy has experienced a number of years of falling occupancy. This is a complicated market most frequently fueled by substantial yet fluctuating new construction investment. But it would be impossible to suggest it has not been a market in retreat for some time. Perhaps it’s only about following the money after all. However, I choose to believe it’s something much bigger that indeed strikes at the heart of the problem that continues to fester. The truths we carry in our hearts are that no one wants to lose control, no one wants to be institutionalized, no one in their right mind would want that control turned over to an overburdened and insufficient governmental bureaucracy and when it hits the fan everyone would rather just stay home. What we of course do want is quality care as a direct result of controlling our own claims destiny. What we all want is private care!


Unfortunately, we now live in very strange marketing and sales times. We seem to have become comfortable selling a product that few can afford. In fact those who can may best be described as those same prospective consumers who use to defiantly proclaim that they could self-insure anyway. A projected brighter future for “lazy” money, the perpetual siren’s song of enhanced ROIs and dramatic leveraging visuals seem to be the new holy trifecta. Just so there is no confusion: What I am suggesting is that we have now successfully isolated the sale to exclusively those who have absolutely no chance of running out of money and falling victim to inadequate planning. Those at greatest risk have been quietly and systematically abandoned by (fill in the blank!). Pointing fingers at this point is absurd. Circumstance becomes history. The blame game at this point is an insult to all concerned.


As has been frequently advocated in this column, we simply got fixated at doing what we have always done as insurance professionals. We measured a real and sufficiently frequent catastrophic risk and for over 20 years we attempted to do battle with that Monster. In the beginning, without sufficient experience at killing dragons, we may have overestimated the ease and prospective efficiencies of dragon slaying. The beast was larger than originally estimated, the cost of effective weapons exceeded our expectations and frankly the dragon was much harder to kill than we thought. As these inevitable realties became increasingly self-apparent, costs rose and markets retreated. Fewer dragons killed, fewer candidates as apprentice dragon slayers, and killing dragons drifted into an exclusive pastime of the landed gentry and idle rich. The pull toward the new world order was inexorable and perhaps unavoidable. The net result is a much wider market gone stale from lack of activity.


The net residue is greater risk from dragon’s breath for the majority of Americans as we have systematically and perhaps inadvertently abandoned those unable to obtain total protection from the dragon slayers guild to protect against the whims of aberrant dragon behavior. Now to the point. We must ask ourselves: Do we have any responsibility for a situation that will ultimately result in the demise of the dragon risk termination business? Must we continue to adhere to the myopic view that every dragon on the horizon must be slain? Why can’t it be enough to simply provide sufficient support to influence the behavior of the beast by enhancing your own personal resources. Must every potential attack on our homes be perceived as a conflagration of dragon fire? Fifteen years ago, when a million Americans bought dragon protection, it represented a market consisting of those who wanted to shift the risk entirely to the dragon slaying companies both for those who could afford to run out of money and those who could not. This privilege has been lost. Dragons do not scare me, but I would like to be able to just be more careful and better prepared to defend myself where they are concerned.


Other than that I have no opinion on the subject.


As seen in Broker World Magazine.

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