CRECHES across Donegal are scrambling to find insurance before Christmas after one of only two insurers in the market pulled out leaving many facing the prospect of closure in the new year if they do not secure policies.
Local creche owners told the Donegal News this week about how they are being quoted thousands of euro for insurance with some companies seeing increases as high as 300 per cent.
Wonder Years Childcare Centre in Letterkenny have seen their insurance increase by 150 per cent in the last two years and are now faced with paying a policy of almost €12,000. Company Secretary, Mary Crawford said increasing insurance costs are going to have a direct impact on parents because they will have no choice but to increase prices. She said the Government has a lot to answer for.
She said: “It is a dramatic increase and it is worrying. It is going to have to be passed on to our customers who are already facing difficulties with childcare costs. I think the government has known about the crisis for more than a year and they have sat on their hands. The government has allowed one insurance company to monopolise the industry and it is wrong.”
Ms Crawford said it is easier for larger companies like Wonder Years to take the blow but the smaller creches around the county will struggle to cope. She said creches in towns and villages around Donegal are a huge part of our local economy and are a necessity. The childcare industry is already under extreme pressure with parents struggling to find places, especially in towns like Letterkenny. This is the case for Wonder Years where there is a waiting list of 160 children.
Aoife Dorrian, Managing Director of Shining Stars Montessori and Creche in Letterkenny also spoke about how the insurance crisis is impacting her business.
She said: “Our insurance this year has been quoted to us and it is due to rise by €2,414. We are currently waiting this week on word back from another insurance company to see if there is another company joining. It is really worrying, after going through the re-registration process for Tusla this has put extra costs on providers and now at the year end we are being hit again by this increase in our insurance.”
Ms Dorrian said she doesn’t believe the government is doing enough to tackle the issue as there is only one company that will cover childcare facilities. Ms Dorrian also agreed it is the smaller providers that will struggle the most.
“The smaller settings may struggle with this large increase this year. I think this was very unexpected and has only been raised in the last number of weeks. Providers would have their money set aside for their insurance like myself and for it to be raised by such amount is alot of extra cost on us.”
The Donegal News spoke to another provider in the south west of the county, who wishes to remain anonymous. The company employs 27 staff and is facing the prospect of closure in January. Their insurance has increased by 300 per cent in the last three years jumping from €800 to €1,800 last year. Their policy ends of December 31 and they are now being quoted €4,275 for renewal.
“We are a non-profit, we are a registered charity, we cannot afford €4,275. The government need to step in and do something. It’s scandalous.”
The provider said she was not told about the insurance company leaving the market and instead overheard it and only received a letter after she contacted them. She was told that the company was still in negotiations and that they are trying to resolve the issue.
“We are up in limbo coming up to Christmas. We are closing on Friday and I am going to have to spend the next two weeks trying to find insurance. I don’t know what’s going to happen.”
Trish McLaughlin, Manager of the Donegal County Childcare Committee, said childcare facilities in the county will not be able to sustain massive increases in insurance.
Ms McLaughlin said: “Childcare facilities will not be able to sustain massive increases in insurance as is now being predicted. The community providers are not for profit and many are already struggling to remain sustainable. We expect many of the private providers will question their ability to remain open. The providers who contacted us were just letting us know that their insurance provider has now stopped providing insurance and they are worried.
“For Donegal – and nationally – this is very concerning. Insurance is a massive overhead as it is. Many of the services pay staff a minimum wage to remain sustainable and a hike in insurance will further embed this practice. Parents need childcare in order to work or avail of further education opportunities, not to mention the benefits attending a quality childcare service have on a child’s development. If services are forced to close as a result of insurance costs there will be a crisis.
“Donegal County Childcare Committee is concerned that a massive increase in insurance will lead to a crisis situation forcing services to reduce staff numbers, cut costs or cease operating; the impact of this on children and families will be immense.”
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