Creches fear they will be forced to close amid rising insurance costs

Thousands of parents are set to be left without childcare from January as creches close their doors because of an insurance crisis.

Creches fear they will be forced to close amid rising insurance costs

Thousands of parents are set to be left without childcare from January as creches close their doors because of an insurance crisis.

The departure of one of the biggest insurance providers in the sector means creches and childcare providers are now being quoted more than triple their current policy or have been completely left without cover.

It is also understood some childcare providers that have an open claim have been unable to even get a quote for alternative insurance.

One creche owner in Galway, who had been paying €3,000 annual insurance, has received a quote from the remaining insurer in the Irish market for almost €10,000 and must decide this week whether to close at Christmas.

Claire McGrath said many other providers are in the same position and have been left with few options other than increasing fees or shutting down.

The Government has been accused of not taking the insurance crisis seriously after Finance Minister Paschal Donohoe admitted he was not aware of the issue until recently and has not met with providers or Children’s Minister Katherine Zappone.

Ironshore Europe, one of only two leading childcare insurers, recently said it is quitting the market, leaving many of the country’s 4,400 providers in a precarious position.

“With the insurance cover of thousands of childcare providers who took out policies with them due to expire in January, this could lead to the closure of providers across the State, or higher costs passed on to parents as they struggle to find cover in a market with less competition,” said Sinn Féin TD Pearse Doherty.

“This has become a creeping crisis across so many sectors — leisure, community groups, childcare, and small businesses. They are at threat of closing next year unless action is taken.”

Anne Rabbitte, Fianna Fáil’s spokeswoman on children and youth affairs, said she has been contacted by childcare companies who can no longer afford to operate and will be shutting up shop in January

“They are getting quotes back that are three times what they normally would have paid. We have only one insurer now left and I think the insurer is looking at the market,” said Ms Rabbitte. “We know that if you have only one provider in the market what that will do in relation to costs.”

Responding to a parliamentary question from Mr Doherty, Mr Donohoe said he has not met with childcare representatives about the rising cost of insurance, and said his department had not received any representations on the issue in the past year.

“This would seem to indicate that there were not any significant problems in relation to the general availability or cost of insurance within the childcare sector during this period,” he said.

“Notwithstanding this, I have recently become aware, through media coverage, that some childcare prov- iders may face difficulties in obtaining insurance, as a result of the apparent withdrawal of a particular insurer operating in that sector.

This may, in particular, impact those providers that have open insurance claims against them, for example, and are unable to secure an alternative provider.

Mr Donohoe said there are “significant constraints” on what the Government can do and neither he nor the Central Bank can compel an insurer to provide cover to any sector as this is a commercial matter for insurers.

Mr Doherty called for the establishment of a ministerial taskforce, led by the Taoiseach, to tackle the crisis.

“The fact that the [finance] minister has not engaged with Minister Zappone or the sector, while thousands of childcare providers will now struggle to get insurance cover to stay open, is unacceptable,” said Mr Doherty.

“Insurance must be a priority at Cabinet level. I am calling on the minister to wake up, set up a ministerial taskforce, and engage with affected sectors immediately.”

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