Specialty Insurance Considerations for the Professional Home Childcare Business
As a home childcare business owner, you love being an important part of children’s lives. You enjoy making the time youngsters spend with you as fun and educational as possible, and you want parents to be confident in you as a trustworthy caregiver.
Toward that end, you’ve gone through the necessary vetting—licensing, registration, and so on—to show that you are a reputable business owner. You’ve had your home inspected for potential hazards and rule compliance, and you’ve secured funding for the materials, furniture and equipment that will make your business attractive to parents and their children.
Knowing you need risk protection, you are looking into general liability and business property insurance. Those policies will go a long way in protecting you and your business from potential financial devastation stemming from a variety of possible claims. But there are other types of claims that, should you expect insurance to cover, may require modification to one of your common policies, or in some cases may require the purchase of a separate insurance policy.
Sexual Abuse and Molestation
If you—or someone working on your behalf, such as an employee or volunteer—are accused of sexual abuse or molestation, traditional general liability insurance may not cover a resulting liability claim. Even if the accusation is proven groundless, without insurance coverage, your business—or depending on how your business is structured, you personally—will be financially responsible for paying legal fees and court costs. According to West Ben Mutual Insurance Company, costs for such claims can easily reach six figures. Consider, as well, that the damage to your reputation resulting from even a baseless claim could cause both you and your business to founder. Such consequences are too serious to not consider securing adequate insurance coverage.
Because you realize that children are vulnerable, you likely have a strict vetting process for anyone engaged in your business, and it may seem unthinkable that someone working with you is capable of harmful conduct. And while you hope that such a claim would prove to be groundless, according to the U.S. Department of Health and Human Services, that’s not always the case. In 2015, the child/daycare provider was proven to be the perpetrator in over 1,600 investigated cases of child maltreatment.
Similar to the issue above, traditional general liability insurance may not cover a bodily injury claim filed against your business due to the physical treatment of a child. A signed release from a parent may prove to be helpful evidence should your business be accused of wrongdoing, but without insurance coverage, you or your business would have to pay legal costs out of pocket.
Traditional general liability insurance is designed to cover claims resulting from bodily injury or property damage, and as a childcare professional, you may be held to a higher standard of care. Tragic accidents can happen all too easily in daycare facilities: In 2014, an Alpharetta, Georgia, toddler was asphyxiated on a playground slide, and in 2016, an Athens, Tennessee, five-year-old was killed when he toppled a television. Perhaps you’ve told customers that your employees are trained and certified in first aid. What happens if an employee treats a child’s injury improperly, making the injury worse? Professional liability insurance may be required should the claim filed against you and/or your business allege that a child’s well-being was harmed due to your failure to provide the standard of care expected.
According to babycenter.com, in the U.S., home childcare is normally less expensive than taking a child to a traditional daycare center. That said, the average annual cost to parents for home childcare is $7,761 for babies and toddlers. Regardless of what you choose to charge for your services, your business may be your and your family’s primary source of income.
You may have homeowners insurance to repair your home should it be severely damaged by fire, windstorm or other covered cause of loss. But repairs take time, and if the damage prevents you from operating your home childcare business, how long could you afford to go without that income? Securing business insurance designed to supplement your lost income due to home damage may be what keeps that damage from causing financial devastation for you and your family.
Care for Caregivers
Insurance is complicated, and trying to secure the right coverage for your business without help will prove challenging. Luckily, you don’t have to approach it alone. Contact The Della Porta Group a Trusted Choice® Independent Insurance Agent today.