Understanding the insurance needs of commercial child care providers

Daycare Insurance Requirements

Commercial child care insurance requirements

It’s no secret that children can be a little (well, more than a little) unpredictable. While commercial child care professionals expect just about anything, the proper insurance coverage provides protection against the unexpected.

As a daycare owner, the kids you care for are your top priority, but when it comes to insuring your business, they are one of many factors to consider. You also may have employees and property that require coverage. Caring for children exposes your business to many liability issues, and in today’s litigation culture, it’s important that you have coverage for incidents and potential legal action.


A conversation with your local independent agent can help you identify all of the coverages your child care business requires.

Do you need insurance for a commercial daycare?

In most cases, yes. To receive a license from the Department of Health and Human Services, commercial daycare providers must carry liability insurance. That license is a requirement for commercial child care providers in most states. Of course, being a licensed care provider is also good for business.

Even if it’s not required, commercial child care providers face many liability exposures. Without coverage, a single incident could be debilitating to a daycare operation.

Follow the leader at daycare

Which insurance coverages are most important for day cares? 

  1. General liability – This covers many of those unexpected events and incidents — like bodily injury or property damage — that can occur in your daycare. If a child is injured on the playground or a parent slips and falls on your sidewalk, you’ll be glad you had general liability insurance. This coverage will keep you financially covered for incident expenses, legal costs, and out-of-court settlements up to your set limit.
  2. Professional liability – No matter how well-trained your staff is, employees can make mistakes or be perceived to do so by children’s parents. Just as doctors and lawyers need professional liability coverage to protect against professional errors and omissions, so do child care providers. 


While general and professional liability coverage are vital, there are several other recommended coverages you should consider, including, but not limited to: 
  • Abduction Expense 
  • Commercial Auto 
  • Data Compromise 
  • Equipment Breakdown 
  • Excess medical payments for volunteers 
  • Identify Theft Expense
  • Umbrella Liability 
  • Worker’s Compensation and Employers Liability

No one knows your business like you do. Your local independent agent can help you align your daycare operation with the appropriate coverage so you can provide exceptional care with peace of mind.

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