Overcoming Challenges for Nanny Agencies in Obtaining Insurance

Jun 20, 2024 | Commercial Insurance

Nanny agencies are in a very special position among employers.

They employ their own staff and can also place and employ workers hired by families to work in the home temporarily or permanently when providing services such as corporate backup care. Accordingly, they play an integral role in the household employment industry for families and their employees.

However, with this employment model comes unique challenges and inherent risks.

Once an agency employs temporary and interim care workers, its business model may be scrutinized — and maybe its insurance provider has even refused coverage.

Here are a few policies that the GTM Insurance Agency can secure for nanny agencies and how they can protect agencies and their owners.

These coverages can protect agencies against claims of negligence or harm caused by a temporary or permanent nanny while on the job. This includes injuries to a child, property damage, or other incidents that could result in legal action against an agency.

General Liability (with Medical Liability)

General liability insurance protects an agency from claims that can come up during normal business operations involving bodily injuries and property damage resulting from the services or operations of your business. For example, a general liability insurance policy can cover claims when an employee causes damage to a client’s property.

Medical liability insurance can protect employees if they need to treat an injury or illness while on the job. This includes the cost of defending lawsuits and payouts for claims related to wrongful practices that may result in bodily injury, medical expenses, or property damage.

Errors and Omissions Policy (E&O)

An E&O policy protects an agency and its owners from claims made by clients for negligent actions, errors, and omissions made before a worker is placed in the client’s home. E&O insurance can help pay for damages, court costs, and settlements, which can be very expensive for an agency.

Professional Liability Insurance

Professional liability insurance (PLI) protects agencies from claims of negligence, mistakes, or malpractice from clients after a worker has been placed in the client’s home.

Surety Bonds and Employee Theft

This policy can cover theft issues in a residence if an agency places and employs workers in their clients’ homes. Surety Bonds can also provide additional coverage for placement agencies and many other valuable additions to round out coverage.

Additional Policies

Other policies you may be aware of and should have in place include:

  • Business Owner Policy (BOP)
  • Cybersecurity and Data Breach Liability Insurance
  • Workers’ Compensation
  • Disability Insurance (if required in your state)
  • Paid Family Leave (if required in your state)

Being fully insured enhances an agency’s credibility and trustworthiness in the eyes of potential clients. It’s a mark of a professional and well-managed business that takes its responsibilities seriously and is prepared to handle any issues that may arise.

Families may be more likely to choose an agency that demonstrates a commitment to safety and responsibility.

Insurance also helps mitigate the financial risks associated with lawsuits or claims. Legal fees, settlements, and medical costs can be significant, and insurance provides nanny agencies with a financial safety net.

Specialty Insurance Program for Nanny Agencies

GTM Insurance Agency has been providing insurance to families since 2004. Now, because of a nanny agency’s unique business model, we are pleased to announce that we can offer agencies the insurance to address their unique risks.  We have developed a specialty program for nanny agencies.

GTM will assess an agency’s needs and design a program based on the number of employees, business structure, and other critical factors.

Our experienced insurance brokers work with a breadth of the top carriers, including The Hartford, Travelers, Chubb, Liberty Mutual, Nationwide, and many others, to find appropriate coverage and competitive quotes that provide the best options for your agency.

In addition to protecting agencies and mitigating risks, GTM can assemble a package of employee benefits, including health insurance, life insurance, flexible spending accounts, health reimbursement arrangements, an employee assistance program, and more.

Call the GTM Insurance Agency at (518) 373-4111 or get a free quote.

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