Oct. 26, 2022
HARRISBURG – The Senate on Wednesday passed a bill authored by Rep. Kate Klunk (R-Hanover) to protect private children and youth social service agencies and residential treatment providers. The legislation would accomplish this by voiding certain indemnification clauses when these agencies renew their professional liability policies.
House Bill 2214
would help ensure the longevity of essential service providers by making indemnification language in government contracts that currently shift all liability to third-party providers unenforceable. Like the House, the Senate lent bipartisan support to the measure with its unanimous vote.
“I’ve heard from agencies and providers who need more affordable operational insurance,” Klunk said. “This bill is an important risk-management strategy that will help create a fairer and safer system for vulnerable children and families.”
For the last several years, private provider agencies have seen increased insurance costs and decreased coverage due to indemnification clauses that require the service provider to take on all liability, regardless of whether the service provider or county agency is at fault. Because of this, providers of behavioral health, drug and alcohol services, foster care, adoption services and residential treatment centers are finding it increasingly cost prohibitive, and at times impossible, to get professional liability insurance that is affordable.
In addition to driving down insurance prices, the bill would ensure mutual indemnification, where each party is liable for its own negligence.
House Bill 2214 goes to Gov. Tom Wolf for his signature to become law.
Representative Kate A. Klunk
169th Legislative District
Pennsylvania House of Representatives