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Best Daycare Insurance of 2022

Bryan Keith

Whether you run a home daycare or a commercial center, accidents and injuries can happen to the ones you are taking care of at your daycare. Daycare insurance can help protect your business and employees against accusations of negligence, lawsuits, and other various liabilities. We’ve evaluated the best daycare insurance providers based on coverage, financial stability, customer satisfaction, and overall quality.

Covers a wide range of industries

$2,000,000

Coverage Up To

$1,000+

Deductibles

Overview

Coverwallet began its journey in New York City in 2015 operating under the Aon Insurance banner. At Coverwallet, you can access everything you need to keep your company well-protected at an unbeatable price.

What we like

  • A skilled advisor to assist you
  • Free quotes from multiple insurance carriers
  • Covers low risk to even some high risk industries
  • Online account management

What we don't

  • No brick-and-mortar offices
  • Deductible costs

Offers a range of insurance poilicies

$2,000,000

Coverage Up To

$0 - $2,000

Deductibles

Overview

Simply Business provides insurance policies for a range of professions and small businesses.

What we like

  • Various business insurance policies
  • Quotes from multiple providers
  • Fast and easy application
  • Strong customer satisfaction

What we don't

  • Policies are a through a third party
  • Claims must be filed through insurance provider

Customized solution to fit your business needs

$2,000,000

Coverage Up To

$0 - $10,000

Deductibles

Overview

With a 100-year history of insuring businesses, Hiscox is well-known across America and globally. With more than 500,000 small business customers, Hiscox is fully aware and trained in the unique risks a business can face.

What we like

  • Established insurance company
  • Dual auto insurance
  • Customizable insurance for over 180 industries
  • Deductibles starting at $0
  • Affordable rates

What we don't

  • Limited US offices
  • Coverage limited to $2 million online

Flexible coverage by the year, month, day, or by the job

$2,000,000

Coverage Up To

$0 - $10,000

Deductibles

Overview

Thimble provides business insurance that can be tailored to your business by the year, month, day, or even the job. At Thimble, the process to getting the right business insurance is simple, scalable, and flexible.

What we like

  • Scheduled coverage options
  • Coverage by the job available
  • Buy a policy online within minutes
  • No hidden fees
  • Affordable plans
  • Drone insurance

What we don't

  • Not available in New York

Affordable plans and coverage provided within minutes

$2,000,000

Coverage Up To

$0 - $2,000

Deductibles

Overview

Next Insurance leverages AI technology to streamline the process to purchase insurance, track claims, and manage policies at no additional cost.

What we like

  • Affordable insurance plans
  • Customized coverage to fit your business
  • Get covered within minutes
  • Near instant access to proof of insurance
  • Quick and easy to process claims

What we don't

  • Not available in New York

eCommerce-only insurance solution

$2,000,000

Coverage Up To

$0 - $5,000

Deductibles

Overview

Spott will ensure that your policy coverage is tailored to your business while complying with Amazon’s Terms and Conditions. They also track changes to Amazon’s Terms and Conditions to identify potential issues with listings before a suspension.

What we like

  • Tailored eCommerce insurance
  • Liability insurance for Amazon sellers
  • Store Suspension coverage
  • Compares leading insurance carriers
  • Flexible coverage options and payment plans
  • Knowledgeable about Amazon’s rules and policies

What we don't

  • Limited physical offices

What is daycare insurance?

There can be many dangers present from working with children or adults. Whether children are playing outside while running around, or indoors learning in a classroom, accidents can happen and injuries can require medical attention. 

Daycare insurance can protect you against risks associated with caring for children/adults or accidents that employees could have while on the job. 

Who needs daycare insurance?

For many states, it is a legal requirement to have insurance if daycare facilities are provided whether you’re a home-based daycare business or a commercial daycare center. 

Types of businesses can include (but are not limited to):

  • Preschool programs
  • Summer camps
  • After-school programs
  • Nonprofit daycare centers
  • Family daycare
  • Home daycare
  • Adult daycare
  • Childcare 

What insurance do daycare businesses need?  

When taking out daycare insurance, it’s important to consider different types of coverage and policies to adequately cover your business for legal liability and potential financial losses. The most common types of coverage for daycare centers are:

General liability insurance

Coverage for general liability can cover a range of basic risks associated with childcare and daycare accidents. Some states may require you to have this policy in place before you offer services. Some of these basic risks include a child playing in the playground and getting injured after falling over, or damage done to someone else’s property while a child is in your care. 

Coverage for general liability insurance can include third-party property damage, legal fees, judgments, medical expenses, and reputational harm.

Exclusions can include damage to equipment used by the business, auto accidents from driving a bus to transport children, and workplace injuries for employees. 

Professional liability insurance

Sometimes referred to as errors and omissions insurance, policies can cover the legal defense costs if employees make a mistake that results in harm to a child or financial losses while a child is in your care. Parents could claim that you served food to their child that caused an allergy or your child care services lacked adequate supervision. 

Coverage can include legal costs, settlement costs, accusations of negligence, oversights, and mistakes made by employees. Some professional liability policies allow you to add abuse and molestation coverage as an add-on where a daycare provider is accused of sexual misconduct. 

Exclusions to your professional liability insurance policy can include workplace accidents, employee injuries, and property damage.

Workers’ compensation insurance

Daycare providers are likely to have employees that help provide childcare services. Many states require businesses to have workers’ compensation insurance in place to protect employees from missed wages due to a work-related accident, such as lifting children or falling over while playing with children. 

Coverage can include medical expenses, lost wages, retraining of employees, permanent injury, death benefits if an employee dies from a work-related accident, and legal costs if an employee or family members take legal action against the business. 

Exclusions can include medical costs for pre-existing medical conditions, directors, and officers of the business, and non-work-related accidents. 

Commercial property insurance

To run a daycare business, you may own or rent a building for your business. Commercial property insurance protects your business from damages done to your property, tools, and equipment you need to do business. This includes incidents where a fire damages your property or someone breaks in and steals your equipment. 

Commercial property insurance coverage can include property damage lawsuits, damage to daycare property, damaged equipment, and operating expenses if the business is forced to temporarily shut down. 

Exclusions can include intentional damage to business property by employees, incidents arising out of wear and tear, flood, and earthquake damage.

Commercial auto insurance

If your daycare facility provides services where a commercial vehicle is required to carry out business activities, many states require you to have commercial auto insurance. For instance, if an employee is driving a bus used to transport children from home to the daycare center, and has an accident, commercial auto coverage can help to pay for damages. 

Coverage can include medical expenses, collision repairs, uninsured motorists, towing and labor, and property damage. 

Many policies exclude drivers under the age of 18 years old and non-business-related driving.

What are the limits of daycare insurance?

Limits of daycare insurance can depend on the type of policy you choose to take out, the location, and the size of your business. Some limits for general liability policies can go up to $1,000,000 per occurrence limit or $2,000,000 aggregate limit. 

How much does daycare insurance cost?

Many factors impact the cost of daycare insurance. Coverage for general liability insurance can average $42 per month and $56 per month for professional liability insurance.

Here are some factors that insurers will consider when providing a quote:

  • Size of business: The size of your workforce can impact the premium you will pay for workers’ compensation insurance. The larger your workforce, the more chance there is that an employee will make a mistake or error that could harm the reputation of your business.
  • Occupational risk: Employees of your business can have various levels of risk. For instance, an employee that carries out administrative tasks will be less likely to get into an accident in the playground than a child care provider with several children to look after. This can impact the cost of your policy. 
  • Location: Some areas can be more costly than others, particularly if there is a high number of lawsuits in your area and medical expenses are high. 
  • Claims history:  For certain policies, your claims history can impact the cost of your premium when you go to renew your policy. If you have a high number of claims each year, this is likely to increase how much you pay for your premium. 
  • Value of equipment: If your daycare facility uses a lot of equipment, this can impact the premium of your commercial property insurance. 
  • Revenue: Daycare centers that earn more revenue can pay more in premiums, as the loss of business income can be higher in certain instances. 
  • Deductibles: Paying less in deductibles often requires that you pay a higher premium. 
  • Coverage limits: Larger daycare businesses may be required to take out policies with higher coverage limits, which can increase the premium of your insurance policy. 

How to choose the best daycare insurance

Every daycare business needs some form of insurance. However, it can be a time-consuming task to compare multiple insurance policies and know which ones are the best for your daycare business. Here are some key factors to consider when comparing daycare insurance policies:

  • Risk of business: Commercial daycare centers can have higher costs and added risks compared to home-based daycare centers. The more risk your daycare business carries, the more coverage your business will require and the higher the costs of your insurance policy. 
  • Additional policies: There may be extra policies that you’ll want to consider for your daycare business such as umbrella liability insurance. When claims exceed the limits of existing coverage, umbrella insurance can help fill the gap and pay for legal fees that are higher than the limits provided. This can be useful for daycare providers that care for children from high-net-worth families who are more likely to take legal action if something goes wrong.