Continuing care retirement / life plan communities have continued to expand their contract and refund options to appeal to consumers, especially following the economic downturn of 2007 to 2009, according to a study by specialty investment banker Ziegler and senior living marketing firm Love & Co.

The two collaborators sent a survey to the chief financial officers of CCRCs and then also interviewed some of the 89 respondents in last summer.

Fifty-six percent of responding communities said they offer at least two of the major contract types, they found. Thirty-nine percent offer Type A (life care) contracts, 61% offer Type B (modified) contracts and 43% offer Type C (fee-for-service) contracts. The research found, however, that even when communities have increased the number of contracts they offer, in most cases, the most popular ones at any one community are the ones that the community has offered for the longest period of time.

Forty-five percent of communities also continue to offer rental contracts, although the greatest growth of rental options occurred in the past five to nine years, the survey found.

When it comes to refunds, the research found that most communities now offer several options. The rare ones that do not tend to be Type A communities offering a declining balance contract or Type C communities offering a high-refund option as the only choice.

When consumers have a choice of refund options, price is the most important factor, respondents said. If the premium on the high-refund option is 70% or more over the cost of the traditional declining balance contract, then consumers are more likely to choose the traditional option. Also, if the weighted average entrance fee in the high-refund option is 20% or more than the market home values in the community’s market, then consumers are more likely to choose the traditional option. Communities should base their pricing strategies on which plan they would prefer that consumers select, according to the report.