4 areas of insurance cover you can’t afford to omit

Guild Insurance recently met with a group of child care owners and operators to ask them what insurance cover features they see as the most important for a centre’s protection. They identified Replacement Cost cover, Children Accident’s Protection cover, Legal Fees cover and Employment Practices Liability cover.

We examine how these covers work and why these benefits might play an essential role in protecting your centre.

1. Replacement Cost cover

Benefit: Effectively eliminates the dangers of underinsurance.

It is the experience of Guild Insurance that underinsurance is often an issue in major incidents and can expose businesses to out-of-pocket expenses up to hundreds of thousands of dollars.

Full Replacement Cost Cover ensures that you aren’t forced to bear the costs of underinsurance, as your building and contents are fully replaced in the event of loss or damage, even without a current valuation of your centre.

2. Children’s Accident Protection cover

Benefit: Compensates parents for child accidents at the centre.

No matter how diligent you are when caring for children, accidents happen. Often parents just want assistance when an accident takes place. Children’s Accident Protection cover is a goodwill gesture that provides compensation for parents or guardians of children who are accidentally injured while under your care.

The cover may be provided whether the centre is deemed to be negligent or not and may even help to prevent a negligence claim when a parent is seeking ‘out of pocket expenses’ and does not want to take civil action.

In addition to benefits for breaks and fractures there are also additional benefits including:

• Cost of damage to clothing
• Travel expenses
• Parents’ loss of wages, and
• Child care fees.

3. Legal Fees cover

Benefit: Legal advice and support when a centre falls foul of regulators.

In addition to the defence costs covered under professional indemnity cover, this covers legal expenses related to an inquiry.

Some examples of when Legal Fees cover has been required include:

• When a child escaped from a child care centre and a complaint was made to DOCS, leading to the centre owner being prosecuted.
• When a centre breached the Disability Discrimination Act by failing to provide an Auslan interpreter and the matter was referred to the Discrimination Board.
• When a centre did not send information to Centrelink for the family assistance rebate and the parent lodged a complaint with the Consumer Trading Tribunal.

Having experienced lawyers available to you in these situations is invaluable. Ensure that your cover includes access to legal advice regarding potential liability incidents or claims, employment-related civil liability issues and Regulatory Authority Approval issues.

4. Employment Practices Liability cover

Benefit: protection in a changing landscape for workplace relations.

Dismissing a worker could lead to you incurring substantial costs if you aren’t adequately covered.

New national employment standards are changing the legal requirements of employment practices, making cover for employment-related matters more important than ever.

Employment Practices Liability cover protects child care businesses when they become legally liable to pay claims made by employees, contract workers, temporary workers or any applicant for employment against a broad range of employment-related claims.

Don’t play around with insufficient insurance

As you can see, each of these covers form an essential part of protecting a centre from unexpected events. When comparing insurance policies for your centre don’t be afraid to ask the hard questions on the cover provided. If your cover turns out to be insufficient when you need to make a claim, it could prove costly.