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Health Insurance for Nannies

Richard A. Eisenberg, CLU, ChFC, President

When a family decides to hire a nanny, there are other benefits that need to be provided besides salary. Many states require Worker's Compensation and, of course, all Government requirements for employees must be adhered to.

Many families wish to provide health insurance as an additional benefit, just as a company might provide health insurance to its employees.

There are two approaches to health insurance: permanent health insurance and temporary health insurance. Permanent insurance can be renewed each year, even if the nanny comes down with a serious medical condition such as diabetes or heart disease. Short term insurance is written for a specific period of time, i.e., six months. If someone develops a medical condition during the policy period, it will be considered pre-existing under future plans.

The cost difference between the two types of insurance plans is remarkable. Typically, the short-term plan costs less than half of the permanent insurance premium. The short-term plan can be used for years, as long as their health remains good.

The permanent plan is usually used for a nanny that will be staying with a family for years, or will be a career nanny for the foreseeable future and wants the protection only permanent coverage can give. A nanny that gives a one year commitment and plans to stay in child care for a short period of time, i.e., one to two years, would be a good candidate for the short term health insurance.

After insuring thousands of nannies, I've found that more than 60% of the families are purchasing short-term plans. They are the most cost-effective and give nannies coverage for the major disaster everyone is worried about.

There are many variations of coverage (deductibles/coinsurance).
Please contact Eisenberg Associates 800-777-5765 to obtain exact rates.
12/2008 Eisenberg Associates, 1340 Centre St., Suite 203, Newton, MA 02159