Premiums Up, Services Down: The Looming Child Welfare Insurance Crisis
A new national survey by the National Organization of State Associations for Children and Association of Children’s Residential & Community Services shows child welfare service providers nationwide pointing to the potential liability insurance crisis we’ve previously elevated.
Here’s what they found:
Rapidly Rising Premiums. Average premium increases were 163% since 2019, and about half of providers had premiums double.
Market Instability. Nearly two-thirds of providers switched carriers in the last 5 years. Nearly two-thirds struggled to even get bids for coverage.
Significant Spending. Just the 327 agencies that responded to the survey spent over $200M on annual premiums.
The math signals challenges for provider stability at a moment of significant fiscal and policy complexity.
Why This Matters
Insurance companies are pricing child welfare as inherently catastrophic risk, regardless of individual track records. This comes as jurisdictions face historic settlements over abuse claims.
Providers typically need coverage to operate, so this trend could signal disruptions to service availability or higher costs that will ultimately get passed on to public agencies.
What We Don’t Know
Whether this shift reflects consistent pricing in of new risks across all jurisdictions, or insurers spreading localized risks (like CA eliminating its statute of limitations on certain claims) across the county.
The Structural Fix
Providers have been arguing a federal fix is needed to stabilize the market. This survey will bolster that claim.