Business Insurance Basics For Daycares And Child Care Providers
Dan Levenson September 08, 2016
Working in the child care industry is extremely rewarding, but it’s also a lot of hard work. When working with children, whether it’s in the context of one-on-one care or in a daycare setting, there are many risks that other businesses simply don’t have to face.
Suppose someone accuses one of the employees at your daycare center of using corporal punishment or in some other way physically or sexually abusing one of the children you care for at your center.
What if a child is hurt in the playground area or is injured somewhere else on your grounds? Or imagine a situation in which a worker is transporting children in a vehicle not owned by your business and there is an accident.
As the owner of a child care service company, you’re legally responsible for any of these situations. The expenses you might have to pay for damages or litigation could be enormous.
These are just some of the reasons you need business insurance for daycares and child care providers.
Two Policies You Must Have
There are two insurance policies that you have to make sure you have, as all businesses need them regardless of their industry.
General Liability Insurance
Any business that has people come onto its premises needs this coverage. This will provide financial protection for an injury at your center. This is especially important to you since children are prone to accidents and injury. Even though most of these injuries are minor, if a child were to suffer a severe injury, the possible financial damages could put you out of business. In addition, this coverage will protect you if there is property damage to your center.
Professional Liability Insurance
This is more commonly known as errors and omissions coverage. Generally, it protects professional services and advice-providing companies as well as individuals from having to pay the full cost of defending against a claim of negligence made by a customer, and damages granted in a civil court.
Some examples of negligence include child abuse, incorrectly dispensing medication, poor food preparation, and mistreatment on field trips. In the case of your business, such coverage would provide protection for your childcare workers and teachers.
Other Kinds Of Policies You Need
The more specific kinds of business insurance for daycares and child care providers include:
- Abuse and molestation liability, which will protect you if an employee is sexually or otherwise abusive.
- Corporal punishment liability, which will protect your daycare center if someone accuses an employee of administering corporal punishment or striking a child. This coverage will provide financial protection if you face a claim.
- Commercial facilities coverage, which offers some of the coverage already mentioned along with additional protection. It often provides errors and omissions insurance, protection for damages from dispensing medication to children, infants up to six weeks old, coverage against charges of child abuse and financial payments, coverage for damages suffered from poor food preparation, personal injury for libel and slander, and coverage for injuries suffered in a swimming pool.
- Commercial vehicle liability, which is necessary if your daycare owns vehicles that transport children to and from schools or home.
- Non-owned or for hire auto liability, which will provide protection if you or a worker drives children in privately owned or rented vehicles to a field trip or other outing. You could be held financially responsible if there is an injury or property damage in such a case.
- Premises liability, which will protect you if a child is injured in a play area, parking lot, or another area surrounding your daycare. This will pay for medical bills or property damage.
- Umbrella liability, which will pay for additional damages beyond the limits of your other policies. This is especially beneficial for larger companies.
Serving children and their families is one of the most important and rewarding jobs in the world. You are in the business of protecting children, but also of protecting yourself. Having adequate insurance is absolutely vital, especially for those who work in the field or who own a daycare center.