Childcare providers told they will not be covered for Covid-19 claims

Childcare providers have been told they will not be insured for Covid-19-related claims if they take part in the Government's new childcare plan for front-line workers.

Minister for Children Katherine Zappone said the new scheme, which is to come into effect after May 18th, would provide essential healthcare workers with 45 hours of childcare per week in their homes. Additional Government funding will be made available to services that reopen to provide the service, while healthcare staff will have to pay €90 per week for childcare to facilitate them going to work under a new Government scheme.

A letter from insurance broker Arachas sent to childcare providers on Thursday said the insurer Allianz would not be in a position to provide insurance cover for Covid-19-related claims.

Arachas told customers that Allianz, the largest insurer in the sector, would continue to provide cover under existing policies, but there would be a carve-out for Covid-19 claims.

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“As there is a material change in risk in terms of the heightened exposure to Covid-19 claims, if you participate in the proposed outreach childcare scheme they will have no option but to apply a Covid-19 exclusion arising out of and in connection with this new activity.”

It said there was an “onus on the State to provide a State indemnity in respect of this exposure”.

“It is our duty as your insurance adviser to highlight to you that under the current framework outlined by your insurer, Allianz, and by the Government departments, that you will not have insurance cover for any claim relating to Covid-19,” it said.

In a statement, Allianz said “no insurer could reasonably be expected to extend policy coverage to include Covid-19 claims resulting from such an initiative”.

Concerns

Marian Quinn, chairperson of the Association of Childcare Professionals, said: "This means that the insurance they have will not cover them for a Covid-related claim. Our understanding would be that if an employee or someone in family gets it and a claim is taken against the provider, they will not be covered for that," she said. She added that there were wider concerns among childcare providers concerning insurance.

“There is lack of clarity on whose insurance is responsible if an employee has an accident in the house; will it mean increased premiums or the risk of not getting a quote for the provider into the future? We also don’t know if the insurance will actually cover extended hours,” she said.

Ms Quinn emphasised that providers want to provide a service for front-line workers, but said there were so many cost and risk implications "that many providers will look at this and say it's not something they can do".

A spokesman for the Department of Children said Allianz’s decision was “a commercial matter for them as an underwriter”.

“The department understands that the insurability of Covid-19-related claims is an issue which has been raised in a number of sectors.

“The department advises childcare providers to contact their insurance broker if they wish to apply to the department to deliver outreach childcare under the scheme,” the spokesman added.