Whether you run a daycare out of your home or have your own business location, you need daycare insurance. While you may treat other people’s kids as your own, accidents still happen. Daycare insurance covers your liability and protects your business.
What is Daycare Insurance?
Daycare insurance is a combination of different business insurance policies tailored to your needs. When you buy daycare insurance, you’re actually getting a package deal, not a specific type of insurance.
Will Home Insurance Cover a Home Daycare?
If you run a home daycare, you may expect your home insurance to cover you. The truth is that it usually won’t. While your home insurance will probably protect you if you watch a friend or family member’s kids, home insurance generally excludes business activities like daycares. That leaves you needing to cover two things. First, your home insurance’s liability coverage almost certainly won’t apply, so you’ll need to get daycare liability coverage. Second, you need to carefully review your property damage policy to see if it would cover damage that happens as a result of your daycare business, such as one of the children causing a flood or fire.
For smaller operations, your home insurance company may allow you to add on coverage for your daycare activities. It would generally be the same as buying separate daycare coverage; it’s just a more convenient way of getting it.
Do You Have to Have Daycare Insurance?
Wisconsin requires all licensed daycares to carry liability insurance. You must have a license if you provide care or supervision to four or more children under the age of seven. Even if you’re not required to carry daycare insurance, you may not want to take on the financial risk of potentially losing all of your assets if something happens to one of the children or your home.
What Type of Daycare Insurance Coverage Do You Need
A daycare may need several types of coverage. These are the most common types that you may want to include in your daycare insurance package.
General liability insurance is just that — general. It covers the general types of mishaps that any kind of business could face. This could include a customer slipping and falling on the way into a tree limb falling on someone. General liability also protects you from the types of injuries that kids get while being kids.
Professional liability applies to you and your staff. The difference between professional and general liability is that professional liability covers claims that arise from your professional judgment and specialized skills. So an injury that occurs from kids just roughhousing might be general liability, while an injury that happens because a staff member didn’t plan an activity properly might be professional liability.
Abuse and Molestation Liability
While you may vet your staff carefully, there is no sure way to prevent physical and sexual abuse. If an incident occurs, you could be found liable for a large judgment, including both physical and mental health costs, as well as emotional distress. Abuse and molestation liability also provides for your legal defense, so it can help you defend a false claim.
Corporal Punishment Liability
Corporal punishment liability applies to claims that arise out of physical discipline. While you probably don’t use corporal punishment, coverage can include when a staff member improperly uses physical discipline or when a false claim is made.
If you ever drive any of your students around, you need commercial auto coverage. Like your home insurance, your personal car insurance generally won’t apply even when you’re using your own car. Commercial auto can include both liability coverage and protection for your vehicle itself. You can cover your own car while working, an employee’s car, a van or other vehicle used only in your business, or a rented vehicle.
If you own a daycare facility, property damage coverage protects your building from things like fires and natural disasters. Whether you own, rent, or use your home, it can also cover your equipment, toys, supplies, and any other property you use in your business.
If you have employees, Wisconsin almost always requires you to carry workers compensation. Workers compensation pays related expenses and lost wages when your employees are injured on the job. It also protects you from having to pay for those same expenses.
Umbrella liability adds additional protection on top of your other liability coverages in case of large claims. For example, you might add an additional $1 million in umbrella coverage on top of your $1 million general liability coverage. The advantage of doing it this way is that the extra $1 million also applies to your auto and specialized liability policies. Using umbrella coverage is generally more cost-effective than raising all of your limits individually.
How Much Does Daycare Insurance Cost?
Daycare insurance costs vary based on your location, number and age of students, number of employees, and other factors. Since daycare insurance scales to the size of your operation, daycares of any size can get the protection that they need at an affordable price.
Request a Quote
Your independent insurance agent can help you figure out what daycare insurance you need and where to find the best price. Sagen & Associates Insurance serves the Shawano and Brodhead areas. Call now to request more information or to start your quote.