Minister for Children Katherine Zappone says the government will be sanctioning a one-off payment averaging €1,500 to registered childcare providers to deal with extra insurance costs.
Ms Zappone said the payments will be issued by December 28.
She said payments will range from €1,500 to up to €26,000 depending on the number of children being cared for in creches and childcare centres and whether they are part-time or full-time.
The move is in response to up to 1,300 childcare providers being affected by soaring insurance premiums after underwriter Ironshore withdrew from the Irish market.
Ms Zappone told the Oireachtas Children’s Committee that the payment is also to cover for the extra administrative work which childcare providers had to undergo this year due to stricter regulations.
Only one insurer is currently providing cover for childcare providers in Ireland and some crèche owners have told how premiums have increased by up to six times.
Ms Zappone said as of lunchtime today, more than 1,000 have received quotes from insurance broker Arachas through insurance company Allianz.
She said more than 200 providers have not yet received quotes and acknowledged that a small number of those in the high risk category may not be provided quotes.
“I understand that the premiums charged by Ironshore were lower than the market average and this has led to the increase,” she said.
“I understand the increase is causing difficulties, but my department are offering a number of supports including a case management system for those experiencing sustainability problems.”
Ms Zappone said providers can expect to experience a 100pc increase in premiums and said she is aware of situations where people have had increases of up to 300pc.