Daycare Insurance

Each business is unique, and insurance requirements may; however, a comprehensive policy package for daycare businesses will typically include the following coverages:

• Commercial General Liability Insurance (CGL): protects your business from childcare liabilities such as allegations involving the three p’s: third-party property, physical and personal damage. CGL may cover medical fees and legal expenses, regardless of the lawsuit’s outcome. For example, during free time, one of the children in your care hurts themselves on the mini-trampoline. As a result, the parents sue for bodily injury.

• Commercial Property Insurance covers the supplies, equipment, and furniture that a daycare needs for its operations. Whether you own or rent the space from which you operate your daycare business, Commercial Property Insurance can protect your property and the items inside should they be lost or damaged due to an insured event, such as a fire, theft, or vandalism. Commercial Property policies typically include Business Interruption Insurance, which covers income lost should you need to temporarily close your business due to an insured event. For example, an unattended space heater causes a small fire, resulting in minor damage to your floors. Your Commercial Property Insurance could cover the cost to replace the damaged floors, while your Business Interruption Insurance could reimburse income lost during repairs.

• Professional Liability Insurance, also known as Errors and Omissions Insurance, protects the staff and employees of your daycare. Employees can make mistakes at any given time, or parents may misunderstand the terms of your daycare services. Either way, a parent can sue for financial loss, misconduct, negligence, or failure to deliver services as advertised.

• Cyber Liability Insurance: If you store client data (e.g., financial, medical), you are liable to protect this information. Cyber insurance may cover the costs associated with electronic incidents (e.g., cyber hack) involving your technology systems and data. For example, your employee clicks on a malicious link, which allows a cyberhacker to steal your client’s financial information. Your Cyber Liability Insurance could provide coverage for notification fees, legal expenses, as well as the costs to secure your data systems.

• Abuse Liability Insurance protects your business against claims and lawsuits alleging an act or threat of sexual, physical, or mental harassment, abuse, or misconduct.

• Legal Advice Helpline provides access to legal advice on a set of standard business topics with an experienced lawyer and the cost to retain a lawyer.

A note for those operating a home daycare center, home insurance typically does not cover business-related claims or activities. Speak with your broker to ensure you have full coverage wherever you operate.