What is a comprehensive plan?
Let’s face the truth about running a child care center- it can prove to be quite an unpredictable environment when working with children. Every day is full of new surprises and new challenges are presented. For this reason, any director of a child care center will stress the importance of having a commercial insurance policy for the center. Most child care centers only possess a basic, standard insurance plan. Typically, these plans come with basic coverages for general liability, property, and auto. The list for coverages included on a plan that is comprehensive is much more extensive and includes coverages such as professional liability, sexual misconduct/abuse, child accident polices, workers compensation, and employment practices liability insurance. Most people will pass up on a comprehensive plan because they have the misconception that these coverages are already taken care of in their plan, or they think that the price of the plan is too high. The truth of the matter is that they couldn’t be more incorrect!
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How much coverage do you have for the children in your childcare center?
General liability protects the liability of business owners in the event of bodily injury or property damage that can result from direct or indirect actions of the owner. What this means is that the general public is covered, people like the parents and the mailman that come into the center. General liability does not cover medical expenses for children who attend or employees that are injured in the childcare center. This is why child accident policies and professional liability policies are so crucial to have. Child accident policies cover the children in your center when an accident occurs. An example of this is if a child breaks an arm tripping over the sandbox on the playground, or if one child throws a toy car at another child and breaks his nose. The child accident policy would cover the immediate medical expenses and therefore discourage parents from filing a lawsuit against the center.
Professional liability coverage is protection for business owners and service providers against claims of negligence. Up to 80% of professional liability claims are due to lack of supervision. An example of a claim covered under this policy would be a child that swallowed a rock on the playground and choked to death. The court finds the center liable due to failure to supervise and the victim’s family was awarded $500,000. In this example, the professional liability policy would cover the court expenses and the judgement made in favor of the victim’s family.
Sexual misconduct and abuse
Another significant coverage that people mistakenly assume would already be covered is sexual misconduct and abuse. This provides coverage for business owners and employees against claims and accusations of molestation and abuse of the children while they are in the care and custody of the center. The covered expenses include the cost of litigations and the cost of judgements made against the center. An example where this coverage would be used is an employee was convicted for shaking a toddler for crying too much, causing severe damage to the child. The jury awards the victims family 1 million dollars in damages. This coverage has shown to be useful in situations where the employee is found not guilty of the crime as well. An example of this is a childcare center employee that was accused of molesting a child 12 years ago. Though the employee has long since quit, the family still sues the center. The jury finds the child care center, and the employee not guilty. However, the cost of the litigation costs the owner $30,000 in court expenses and lawyer fees which would be taken care of by the sexual misconduct/abuse policy.
How much coverage do your employees have?
In addition to liability, child accident policies, and sexual misconduct/abuse, a comprehensive plan is critical for the fact that it has worker’s compensation and employment practices liability insurance (EPLI). These are two coverages that people can also misguidedly believe are already included in their plans. Workers compensation provides wage replacement and medical benefits to employees injured in the course of employment at little cost to the business owner. This coverage deters employees from suing the company. However, business owners who have not purchased a worker’s compensation policy waive the right to defense in court! Even though Texas is one of the only few states where having this policy is not mandatory, it is still very important for business owners to carry a work comp policy in the situation where an employee is injured at work.
EPLI, or employment practices liability insurance, provides coverage for lawsuits filed against the employer for things such as wrongful termination, discrimination, workplace harassment, and retaliation. Statistics show that 4 out of every 10 employers are sued by former employees. Even if you are not found guilty in court, EPLI will take care of the cost of litigations. Texas’ average EPLI claim defense costs have been documented at $75,000 on average, and the award for all plaintiff verdicts is an average of over $200,000. How much can you risk losing?
Don’t wait for the worst-case scenario to happen before taking action!
When purchasing an insurance plan for your childcare center, remember how unpredictable life can be, and that it is best to prepare for the worst-case scenario rather than waiting for it happen. At Lee Insurance Agency we offer all inclusive, comprehensive insurance plans to ensure the best for your business needs. We are an independent insurance agency that represents all the A rated insurance companies writing insurance for childcare centers in Texas. Unlike captive agents, we hold the great ability to shop your insurance with all our companies at any time. We believe strong footing in customer service, knowledge, and experience is what makes us stand out from the others as an agency. Contact is today by phone at (281) 812-8400, online at our website (Leeinsuranceagency.com), or on our Facebook page!