My feeling is that you need to use a broker. Surprised that Morton Michel can't help you, though maybe they just can't get an insurer to consider what you are proposing. So try other brokers to see if they have any better luck.
BIBA: Find a Broker
Why are you wanting the nanny to be on your policy? Could you not have two separate policies - I don't know if you can, ask a broker and see what they suggest.
Is there a different vehicle your nanny could use? It may be down to the vehicle being of an insurance group where the insurance underwriters just won't consider insuring your nanny.
Are there any reasons why your nanny could not get insurance? Is it just the vehicle, or is it age, inexperience, points on licence etc? Brokers should be able to help, though the more factors there are going against things, the harder it will be to find an insurer willing to provide cover.
Consider the level of cover needed, are you asking for the right thing. MM would have been doing effectively Mini-Bus insurance... which means your nanny is covered for transporting children for whom they care. This is different to Business usage. It is more like Hire & Reward.
Find a local broker, go and see them and have a chat about what it is you need cover for, level of cover, see what they can find for you.