Home Childcare Business: Hiring Workers

As the cost of traditional daycare centers continue to rise, the home childcare industry is primed for growth. Depending on your location, the number of workers required on a per-child basis will vary, but one thing remains certain: Bringing new employees or volunteers into your business creates exposures your business may not otherwise have faced. The following are just a few exposures regarding some unique insurance coverage issues your business should prepare for when bringing in help.

Liability for the Actions of Employees and Volunteers

Running a home childcare business presents a multitude of liability concerns for employers and employees. The behavior of young children is unpredictable and can be unsafe even under careful supervision. The thought of a child being injured while in the care of your business is a terrible but realistic possibility. Furthermore, property damage can happen in a split second— just consider how easily a ball could hit a neighbor's car or window. To help protect your business and yourself from having to pay the costs of injuries or property damage, you probably have purchased a business liability insurance policy. But if your business expands and you hire employees or use volunteers, make sure to contact your Trusted Choice® Independent Insurance Agent to ensure that your liability policy will respond to claims resulting from their actions or possible negligence.

Workers Compensation

Laws regarding whether an employer must provide workers compensation insurance coverage vary significantly by state. Information about your state law regarding this coverage, contact your Trusted Choice® Independent Insurance Agent. If the law in your state does not mandate that you purchase workers compensation insurance to cover your staff's work-related injuries or illnesses, consider these two important reasons to do so anyway:

• Workers comp can provide your injured worker with essential dollars to receive needed medical care as well as compensation for lost wages needed to pay other living expenses.
• As the employer, you could become financially responsible for all costs associated with the worker's injury or illness - including their medical bills, rehab costs, lost wages and resulting death.

Employment Practices Liability

Childcare operators are aware of the risks involved in being entrusted with the well-being of people's children. But the liability claim that ultimately bankrupts your business may actually have nothing at all to do with a child's injury. Consider the difficulty of having to let an employee go and then learning that, as a result, you are being accused of wrongful termination due to discrimination. Even if the claim is proven groundless, there likely will still be expensive costs associated with defense. Unfortunately, your business liability insurance policy will not cover such costs. To help avoid the potential financial disaster such an employment-related liability claim could cause to you and your business, ask your Trusted Choice® Independent Insurance Agent about employment practices liability insurance.

Confirm Coverage of Third-Party Contractors

Does your growth plan include contracting with outside help? Say, for example, you are looking for a competitive advantage to help your business appeal to parents and their children, and you decide to bring in a music teacher or language tutor as an outside contractor. You already know how important it is to properly vet those individuals with background checks, but have you considered asking them for proof of insurance?Should a contractor not be properly insured, a liability claim created by their actions or an injury they suffer on your premises may become your responsibility.

Insurance can be confusing. If you need to ask contractors for proof of insurance, but you're not sure how to determine its adequacy, ask your Trusted Choice® Independent Insurance Agent for assistance.