Hired Help: Reducing Your Liability

If you are looking to hire some additional help around the house to watch your children, clean, perform gardening tasks or cook, you have a lot of things to consider. In fact, if you wish to hire domestic help, you need to determine where to find assistance, what your insurance needs are and how to fulfill your legal obligations. Insuring household help can be tricky. Here’s what you need to know.

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Types of Hired Help

#1: Individuals hired through an outside firm, such as a chef or a nurse:

Determine if the individual is your employee or an employee of the firm.

If the individual is an employee of a firm, obtain a copy of the firm’s certificates of insurance documenting that the firm has workers’ compensation insurance for its employees. If the organization also has health and disability insurance for its employees, then hired help injured on your property will receive medical treatment through the employer.

#2: Occasional employees such as babysitters or neighborhood kids who rake your leaves:

If you hire individuals for occasional jobs for your home, you should evaluate your homeowners or renters insurance policy to determine whether you have enough liability coverage.

Consider getting more liability insurance by raising your existing amount or purchasing an umbrella liability policy.

Learn more about the no-fault medical coverage within your homeowners insurance policy. This coverage allows you to submit medical claims to your insurance company if someone is injured on your property (other than immediate family members). Most people tend to buy only $1,000 worth of this coverage, yet you may want to increase that amount to $5,000 for added protection.

#3: Permanent full- or part-time hired help:

If you hire individuals to come work at your home on a regular basis, consult an attorney regarding tax deductions and workers’ compensation issues. Then, contact Magnolia Insurance Group to purchase a workers’ compensation policy, which is part of insuring household help. This will provide protection for medical care and rehabilitation for injured hired help. It will also cover lost wages if individuals get hurt and cannot work, and death benefits for beneficiaries.

Hiring Your Help

Hire a Service Agency

  • Check references to verify the company’s reliability before hiring them.
  • Consult your local Better Business Bureau (BBB) for complaints filed against the company.
  • Ask the company how they conduct background checks on the help they provide.
  • Ask to see proof of insurance in case your property is damaged by their hired help.

Hire Help Through An Agency

  • Check the agency’s background and the BBB for complaints.
  • Inquire about the fees charged to you for using the agency’s services.
  • Determine how the agency will work with you to find the necessary help that you need. Also determine how the agency will work with you if the candidate they select is not a good fit for your family.
  • Determine how the agency screens its potential candidates.
  • Insist that candidates are individually interviewed, have their references checked and that their criminal and driving records are investigated.
  • Determine whether the candidate you choose is legally able to work in the United States.

Hire Help on Your Own

  • Place an ad in your local newspaper or ask family and friends for a recommendation.
  • Screen and interview all potential candidates and check references, criminal backgrounds, driving records and green card status (if necessary) for all potential finalists.
  • Contact your local police department for more information on how to obtain a criminal background check and driving record.

Once you’ve hired someone on your own, you have several legal obligations. You must first confirm that the person is legally able to work in the U.S. Then, once hired, you will need to pay taxes on their wages. You should also contact Magnolia Insurance Group to determine whether your Homeowners Insurance policy covers Workers’ Compensation in case your hired help gets injured on the job. Although insuring household help does present some challenges, we have the knowledge and tools to help you get it done right.