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Day Care Child Abuse Scares Off Insurance Companies

March 22, 1985

HARTFORD, Conn. (AP) _ Dozens of insurance companies, reacting to recent incidents of child abuse and other home problems at day-care centers, have stopped offering coverage, tightened eligibility or boosted premiums for the facilities, a report says.

The higher premiums, triple in some cases, have put insurance out of reach for some day care operators, forcing them to close or operate without it, The Hartford Courant reported today.

″I just got out of it,″ said Judy Hetrick, a registered nurse whose first liability insurance premium last September was $92 a year - until it was canceled in mid-November.

She finally found an insurer who would write a policy for $342 a year and decided to quit the business.

″The cost was the determining factor, along with the realization that this whole issue of liability and suits against me really changed things,″ she said.

Higher insurance rates may force some day care centers to raise their rates, or others to go uninsured, insurance and day care officials say.

The state licenses about 3,000 day care providers. Insurance is not required for state-approved programs.

The irony of the major companies pulling out is not lost on Shirley Herchenroether, the child-care consultant for Aetna. She is trying to find day care programs in the Middletown area for the 5,000 employees of Aetna’s huge new complex off Route 72.

″It is very ironic and very sad that day care operators are having trouble with liability insurance,″ said Ms. Herchenroether.

An independent insurance agency in Waterford, which handled about 120 day care programs statewide a year ago, now has only 30 day care clients.

″We called at least 25 insurance companies this fall (looking for the coverage). They just said they wouldn’t cover day care any more because of their fear over the child abuse stories out of California and New York,″ said Jackie Smith of Smith Insurance.

Her agency now gets coverage from Western World Insurance Co. of Keene, N.H., through Connecticut Underwriters of Portland, a specialist in finding high-risk insurance.

Western World premiums for day care, which doubled Jan. 1, are now a minimum of $500 a year for $100,000 liability coverage and $750 for $300,000 liability.

And the policies have a ″no-touch″ exclusion, which means the policy does not cover sexual abuse or other similar claims, said Henry J. Stone Jr., president of Connecticut Underwriters.

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