Strategies, Challenges, and Answers

Is My Teenage Daughter In Business As A Babysitter?

Trying to make a few dollars has always been a real struggle.  However, you don’t have to be earning much money to be thought of as being in business for yourself.  At least that appears to be the position of the Nevada Supreme Court in the case of Dwello v. American Reliance Ins. Co., 115 Nev. 422, 990 P.2d 190 (1999).

In Dwello, a seven-year-old child was injured while he was being cared for by the insured.  The insured watched the child from 6 a.m. to 4 p.m. five days a week at the rate of $50.00 per week.  (My calculator tells me that is $1.00 per hour and $2,600 per year).  The babysitting revenue made up 40% of the insured’s total income.

1017691_teen_model The insured’s dog bit the child on the face, head and eye.  The complaint claimed that the insureds knew of the dog’s propensity to bite because it had bitten before.  The allegations were that the insureds failed to inform the parents of the dog’s bad temperament.

The policy included an exclusion for business pursuits:

Comprehensive Personal Liability Coverage and Medical Payments to Others Coverage Does Not Pay for Bodily Injury or Property Damage: . . .Arising out of your business pursuits. This also includes your occasional or part-time business pursuits.

In spite of the fact that the insured was not licensed as a child care service, the court found that the insured was engaged in a business pursuit.   The insured attempted to argue that there was an exception to the business exclusion.  The court explained:

Dwello also argues that the dog bite was an exception to the business pursuits exclusion since it was one of the “[a]ctivities which are ordinarily incidental to non-business pursuits.” A babysitter’s primary role is to maintain a safe, healthy environment and to keep the child out of harm’s way. While the babysitter’s services are engaged, the babysitter maintains a continuous duty to provide for the child. The dog bite was related to negligent supervision, and was not “incidental to non-business pursuits.” Thus, the exception to the exclusion does not apply.

The court upheld the decision of the trial court in declaratory relief that the carrier owed no duty to defend or indemnify the insured homeowner for the dog bite.