Is it ok to use hydrocortisone 1% cream daily for eczema in 3 year old continuously for an year? will there be any side effects using it daily for longer period of time say 1 year or so?

Yes: I don't use anything stronger than 1/2% on face unless there is thickened irritated skin & then only 2X/day. Using 1% on all other skin is fine for most sites up to several times a day. The 1% is not absorbed into the serum/blood to the point it would trigger any significant issues. However, any steroid can thin the skin so you must decrease use when this happens & eczema is controlled.