When you are ill, the setting closes
As a registered childminder, you are the business. If you are signed off with an injury or illness, you cannot simply send in a stand-in, because only you and registered assistants can care for the children. Parents will need to find other childcare, and some may not come back once they have settled elsewhere.
That makes a long absence twice as damaging. You lose income while you are off and may need months to rebuild your numbers when you return. Income protection can bridge the time off, and a sensible benefit level can ease the slow restart.
A busy, physical day at home
Childminding means lifting babies, pushing double buggies on the school run, kneeling for play and cleaning up after meals. It is a long day, often from early morning to early evening, followed by planning, learning journals and paperwork for your regulator.
Back problems, infections passed around by young children and the strain of running a business single-handed all lead to time off. Stress and exhaustion count as illnesses if a doctor signs you off, and income protection treats them in the same way as a physical injury.
- Back and joint strain from lifting and carrying
- Frequent infections
- Long days with few breaks
- Stress from running the business alone
Proving your income as a childminder
Insurers base income protection on your taxable profit, which for childminders is fees minus expenses. Many childminders use a simplified method to work out household costs used for the business, which can reduce taxable profit. Bear that in mind when you choose a benefit amount.
Have your last two or three tax returns ready. If your setting has grown recently, some insurers will look at your most recent year alone, which may support a higher benefit. If you have just registered, a few insurers will consider your previous earnings.
If you employ an assistant, think about whether the setting could stay open with them in charge for a while, and what that would mean for your income. Your regulator's rules on who can care for children will decide this.
Life insurance when your home is your workplace
Your family relies on your income, and often on the space in your home that the business uses. Life insurance can clear the mortgage so your family can stay put. Critical illness cover pays a lump sum on diagnosis of a listed serious condition, which can help if you have to close for a long time.
Without an employer, you have no death in service, so a personal policy is often your family's main protection. Writing it in trust can help the money reach them quickly, without waiting for your estate to be sorted out, and it can keep the payout outside your estate for inheritance tax.
How Hi Tomorrow helps childminders
We look at your profit, your outgoings and your savings, then compare income protection from UK insurers. Insurers group occupations into risk classes, which affects price and how they assess a claim. We explain whether a policy would judge you on your own job.
We can also arrange life insurance and critical illness cover and explain how each one would help your family and your setting. If you already have a policy from an old job or a mortgage, we check whether it still fits. The insurer has the final say through its underwriting.