Child care is a challenging industry. The potential for accidents is always there, and with people relying on you at all times of the day, you need protection.
Having the right cover in place is critical to protect your investment and therefore you need to understand the insurances that are available to you and deciding what to purchase.
Apart from Workers Compensation which is governed in the State in which you reside, types of insurance you need to consider include:
- General Liability (Public and Products Liability)
- Property insurance for your Buildings, Contents & equipment
- Business interruption (Loss of Profits)
- Professional indemnity for such things as sexual or physical abuse & molestation if one of your employees or others with access to children in your program abuses a child in your care.
- Motor vehicle if you arrange trips and excursions
For Public and Products Liability, the law requires a greater degree of care to be exercised in dealing with children than with adults. In regard to children, the duty of care is high because children are vulnerable in that they have yet to physically and mentally mature.
Public Liability risks at the premises include:
- Slips, trips and falls
- Car park incidents
- Poor hygiene etc in facilities
- Inadequate signage and fire protection
- Cuts from chipped plates, cups etc
- Choking on food Injury to children in care (this may also be a professional indemnity claim, depending on circumstances)
- External activities Travel and excursions
- Inappropriate medical aid
- Property maintenance
- Assaults –physical/sexual/psychological
- Third party property damage to adjacent properties from fire risk
A childcare centre also has a high exposure to business interruption due to the high dependency on location and potential loss of customers.
Working parents cannot wait even a week without childcare facilities for their children. Therefore an interruption most probably will cause all of the existing clients to leave. It is very difficult to attract those clients again once the centres have been rebuilt.
After a loss it is very difficult for the insured to find a replacement location. Even if replacement space can be found, it will probably take some time to bring it up to the specific requirements/code and to get the necessary approval. The length of time required to completely rebuild will need to be established.
Therefore apart from insurance for your buildings etc you must consider Business interruption Insurance for your facility.
Professional Liability Insurance insures you and others you employ for loss arising out of your responsibility or negligence while performing your business. This includes such things as sexual abuse and molestation.
As you can see, it is important to have the right protection in place to protect your Investment and from a risk management perspective, the children and other third parties.