For many care providers, insurance is no longer being viewed as a routine annual renewal. In 2026, it is increasingly becoming part of a wider conversation about resilience, governance and whether the service is genuinely protected against the kind of disruption, loss or scrutiny that can test it most. One issue is especially visible: underinsurance. The other is quieter, but growing in significance: leadership exposure.
Some issues in care become urgent because they arrive suddenly.
Others become important because the environment around them changes, and what once felt sufficient no longer feels quite as safe.
That is where insurance now sits.
For years, it has often been treated as a necessary but largely periodic exercise — reviewed at renewal, negotiated around cost, then put back into the background while attention returned to more immediate operational pressures. In 2026, that is beginning to shift.
Not because insurance has suddenly become a new topic, but because the conditions around it have changed. Rebuild costs have moved. Asset values have drifted. Governance expectations are higher. Leadership accountability is more visible. And across the wider market, there is growing concern that many organisations may be carrying risks they do not fully understand until a claim, investigation or major disruption puts those assumptions to the test.
That is why this conversation matters now.
Not as an insurance-market issue in isolation, but as part of a wider question many providers are increasingly asking across several areas of the business:
if something serious happened, how confident are we that the service is protected in the way we assume it is?
The most immediate issue: underinsurance
Of the two themes now rising most clearly, underinsurance is the more visible one.
It is also the one with the strongest evidence behind it.
The ABI’s January 2026 report on SME protection gaps says underinsurance remains a significant issue across UK business, especially around buildings, stock and equipment. It warns that many firms do not realise they are underinsured until they need to claim, and that outdated sums insured can leave businesses absorbing losses they thought were covered.
For care providers, that matters even more than it might in many other sectors.
Because care services are not simple premises with routine replacement profiles. They are operational environments that depend on buildings, specialist equipment, furnishings, technology, continuity of care, staff deployment and, in many cases, very significant recovery time if a major incident interrupts the service.
That is what makes underinsurance such a serious issue in 2026.
Not because it is new. But because it may now be wider, deeper and more commercially dangerous than many providers realise.
Recent property insurance analysis has gone further still, identifying care homes as the most underinsured property type assessed, with 85% insured below rebuild cost. The same data says the average underinsured property is covered for only 67% of true rebuild value, exposing businesses to potentially significant shortfalls if a major loss occurs and the average clause is applied.
That is a major warning sign.
Because once a provider finds itself underinsured at the point of claim, the issue is no longer simply whether damage occurred. It becomes whether the service can absorb the uncovered portion of the loss at the very point recovery is already most difficult.
Why is this risk becoming more acute
A large part of the problem is that underinsurance often develops quietly.
Buildings insured several years ago may not reflect today’s rebuild costs. Contents values may no longer capture what would actually need to be replaced. Business interruption periods may have been set on assumptions that now feel too short for the realities of recovery, particularly in a regulated, high-dependency care environment.
And all of this is happening against a backdrop of continued pressure on build and reinstatement costs.
BCIS said in late 2025 that labour shortages, materials pressure and inflation-linked construction costs were still pushing up reinstatement values and increasing the risk that businesses renewing without updated valuations would drift further into underinsurance.
That is what makes this such a live issue now.
Not because providers are being careless, but because values can move materially over time while cover arrangements remain largely unchanged on paper.
For a care provider, the consequences are rarely minor.
A major property claim is not just a property event. It is also a continuity event, a staffing event, a resident-impact event and, potentially, a reputational event. That is why underinsurance now deserves to be read as a resilience issue, not just a technical insurance one.
The quieter issue rising underneath it: leadership exposure
If underinsurance is the visible headline risk, leadership exposure is the quieter second theme building beneath it.
This is not about dramatic claims-making. It is about recognising that the accountability environment around care leadership has become more demanding.
CQC’s assessment framework continues to place strong weight on governance, management and sustainability, including clarity of roles, accountability, oversight and how effectively leaders use information about risk, performance and outcomes. That broader environment matters because it increases the visibility of leadership decisions and the importance of showing that governance is sound when something goes wrong.
That is where the conversation around directors’ and officers’ liability, and management liability more broadly, becomes more relevant in 2026.
The evidence here is more strategic than sector-noisy. There is not a flood of care providers publicly posting about D&O in the way underinsurance is being surfaced through market analysis. But the wider insurance market is clearly talking more about it. Allianz’s 2026 D&O outlook says directors and officers are operating in a more complex economic and regulatory environment, with evolving exposures around financial stress, decision-making scrutiny and governance risk.
For care providers, that does not mean assuming personal action is around every corner.
It means recognising that leadership accountability now sits in a more exposed environment than before, and that many organisations are understandably taking a closer look at whether current management liability arrangements genuinely match the realities of the leadership burden being carried.
That matters especially in independent and mid-sized organisations, where leadership, ownership and personal financial exposure can sometimes sit closer together.
Because even where a matter is ultimately resolved successfully, the process of responding to scrutiny, investigation or legal challenge can still be costly, distracting and reputationally significant.
This is bigger than insurance
What makes these two issues especially important now is that they sit inside a wider shift in how providers are thinking about resilience.
Across the sector, conversations about risk are becoming more joined up.
Energy is being discussed more strategically. Digital resilience is being reviewed more seriously. Governance is being scrutinised more closely. Workforce stability is being treated as an operational issue, not just a people issue. Insurance now increasingly belongs in that same category.
That is the more useful way to understand what is happening.
This is not simply about whether cover exists.
It is about whether the insurance structure around the organisation still reflects the real shape of the risks it now carries.
And that is why the most forward-looking providers are not treating insurance purely as a price exercise.
They are treating it as a visibility exercise.
A way of understanding whether assumptions made years ago still stand up against the business being run today.
What stronger providers are doing now
The stronger response in 2026 is not panic, and it is not automatically buying more cover.
It is a review.
Reviewing whether building and contents valuations are still realistic.
Reviewing whether business interruption periods reflect the actual time a care service might need to recover properly.
Reviewing whether current policy structures still reflect the way the organisation now operates.
Reviewing whether leadership exposure has changed as the accountability environment has changed around it.
And reviewing all of that with specialist support that understands the operating realities of care.
That last point matters.
For most providers, becoming insurance specialists themselves is neither realistic nor necessary. The more practical route is often to work with a suitably qualified adviser or broker who understands the sector properly, can interpret policy detail in the context of 24/7 care operations, and can help leadership teams ask better questions of the cover they already have.
That is where external expertise adds value.
Not by making the subject more complicated, but by helping remove false confidence and replace it with clearer visibility.
Why this should be read positively
There is a constructive message here for providers.
The fact that insurance is moving closer to the centre of the resilience conversation is not a sign that the sector is becoming weaker. In many ways, it is a sign that providers are becoming more commercially mature in how they think about protection.
That matters.
Because organisations that review protection properly are not simply trying to avoid worst-case scenarios. They are strengthening one of the quieter foundations of resilience: knowing where recovery could become difficult, where leadership could be more exposed than assumed, and where better visibility now could prevent much greater pain later.
That is not alarmism.
That is good management.
And in a sector where disruption is costly, scrutiny is sharper and financial headroom is tighter, that kind of maturity can make a very real difference.
The more useful question for providers now
Perhaps the most important question in 2026 is no longer:
Do we have insurance in place?
For all providers, the answer to that is obvious.
The more useful question is:
Does the cover we have still reflect the real risks, values and leadership exposure within the business we are running today?
That is the more revealing question now.
Because the real story behind insurance in 2026 is not just about premium movement.
It is about whether providers have enough clarity around protection at a time when rebuild values, operating pressures and leadership accountability are all becoming more demanding.
And for many, that makes insurance far more than a renewal issue.
It makes it part of how resilience is now being built.
Final word
Insurance in 2026 is no longer just about securing a quote and moving on.
For many care providers, it is becoming part of a wider boardroom conversation about asset protection, leadership exposure and whether the service is genuinely prepared for the kind of loss, disruption or scrutiny that can test it most.
That is why underinsurance is rising so visibly up the agenda.
And it is why the quieter conversation around leadership exposure is likely to keep growing alongside it.
Not because these are fashionable topics.
But because they are two of the clearest places where old assumptions can quietly become new weaknesses if they are not reviewed in time.
At Care Circle Network, we will continue to track the issues reshaping risk and resilience across the sector — and the practical questions providers are now asking as they respond.
Important note: This article is for information only and does not constitute insurance, legal or financial advice. Providers should always seek guidance from a suitably qualified and authorised adviser or broker with relevant sector understanding.
