A thousand questions can race through a parent’s mind when hiring a new babysitter or in-home nanny: Is the candidate experienced? Good with kids? Responsible? Dependable? CPR- and first-aid-certified? Able to cook? Does he or she have reliable transportation?
Here’s one most parents don’t think of: Does my insurance cover my babysitter?
When hiring someone to care for your children in your home, you should first consider some worst-case scenarios: What if the babysitter is injured at your home? What if the family dog bites him or he falls off the backyard play structure? Does your homeowners insurance cover his medical expenses? Does it cover your legal expenses if his family files suit against you?
While these questions can be enough to make you cancel your date night and forget hiring a sitter altogether, don’t despair. You have methods at your disposal to proactively protect yourself, your family, your home, and your babysitter in the rare event an injury occurs on your property. Here are some essential tips:
- Make sure your homeowners policy has adequate liability coverage.
Talk to your insurance agent about how much liability coverage your current policy includes. You may find it’s quite affordable to increase home liability coverage.
- Know the amount of “no-fault medical coverage” in your homeowner’s policy.
With this type of coverage, if your babysitter — or anyone beyond an immediate family member — were to sustain an injury on your property, you would be able to submit his or her medical bills directly to your insurance company and be reimbursed. This can help you avoid a long and expensive legal tussle if an accident were to occur.
- Consider purchasing an umbrella policy.
Also called “excess liability insurance,” an umbrella policy goes beyond the monetary limits of a homeowners policy and provides added protection if an injured party were to sue you. For an estimated $150 to $300 per year, you could purchase a $1 million personal umbrella liability policy that would kick in after you’d exhausted your homeowners policy limits.
- Don’t treat a full-time nanny the same as an occasional babysitter.
If you hire someone to watch your children in your home all day several days a week while you and your spouse are at work, you don’t have a babysitter — you have a full-time employee working in your home. In this case, you could reduce your risk by claiming this caretaker as an employee and providing workers’ compensation insurance. This is important because, if an injury or lawsuit were to occur, your homeowners insurance could deny any claims the insurer determines should fall under workers’ compensation. This means you could be on the hook for the caretaker’s medical bills, attorney’s fees, and lost wages if he or she is unable to work.
At some point, nearly every parent will want and need to hire a babysitter or maybe even a full-time nanny. While it shouldn’t be a terrifying decision, know you do assume certain risks when hiring someone to work in your home. A thorough review of your homeowners policy and a discussion with your insurance agent about your child care needs and intentions before hiring a babysitter is a great step toward extra financial protection and peace of mind.