Most likely, you are describing a strawberry hemangioma. These start at or soon after birth, enlarge for a while, and most regress by age 9. When they go away, they may leave a scar. Laser treatment can help them go away faster, and is safe, though a bit painful. I would consult a dermatologist who works with the pulsed dye laser. Any teaching hospital with a dermatology department would be a good place to start for a consultation. Insurance will most likely not cover the procedure, which may take several sessions and cost anywhere from a few hundred to a thousand dollars or more. It's not out of the question to ask, but you may decide to hold off until she's a bit older. 3 year olds are too big to hold down and too small to reason with. Also, the final cosrmetic outcome is less crucial than if it were on the face.
Best.
Dr. Rockoff