Everything You Need to Know About Daycare Business Insurance

By: Updated: February 9, 2022


Daycares should have insurance because there are many risks associated with caring for young children, such as injuries and property damage. This applies whether you are operating out of your home or in commercial premises. In addition, parents with a child in a daycare should make sure that the facility has the appropriate insurance coverage.


What is daycare business insurance?

Childcare centre insurance is similar to coverage for other types of businesses. Here are some of the insurance types that you will need:

  • Commercial property insurance: You will require this whether you operate from your home or have commercial space. This covers you for incidents such as fire and property damage. If you operate a home daycare, check with your insurance broker to see how this impacts your existing homeowner’s insurance.
  • Commercial general liability: This one is important. It protects you if a child is injured at your daycare. Or if a parent slips and falls on your steps when dropping off a child. This will cover any damages and legal costs.
  • Abuse liability: Hopefully, there will not be any accusations of abuse at your site but this coverage is vital. It covers you for allegations of physical, sexual or mental abuse.


What does daycare insurance cover?

As we have indicated above, commercial child care insurance should cover a variety of potential incidents that can happen at a daycare. However, parents should be proactive in protecting their child. In Ontario, daycares must follow the regulations set out under the Ontario Child Care and Early Years Act.

When visiting a potential daycare, or picking up your child from an existing one, be sure to watch for these warning signs:

  • There are too many children in the daycare and not enough staff. In Ontario, there is a maximum of five children for a home daycare run by a single provider.
  • Unexplained injuries, such as cuts, bruises and burns. If you spot these on your child, ask your daycare provider how they happened.
  • Your child is often hungry when they get home from daycare.
  • The daycare is disorganized and unclean.
  • Your child undergoes behavioral changes, such as being anxious or withdrawn.

Unfortunately, there is a shortage of daycare spaces in many Canadian communities. Nevertheless, if you are concerned about your child’s safety, find an alternative daycare as quickly as possible.


How much does daycare business insurance cost?

The cost will vary depending on the size of your operation. If you are running a home daycare by yourself, you can expect a modest charge. On the other hand, a daycare with a dozen employees in a large commercial space will likely face a higher cost for commercial child care insurance.

It will cost about $700 per year for an insurance package with a limit of $2 million.


Different types of daycare insurance

As we have indicated, you will need comprehensive insurance coverage to cover a range of scenarios that could occur at your daycare. Your insurance broker can help make sure that you are appropriately insured.


Common claim scenarios

Minor bumps and bruises are quite common in daycares. Let’s face it, children love to explore and sometimes they fall down.

However, there can be situations where an insurance claim or lawsuit occurs:

  • Unsafe furniture or play equipment: The daycare should not have anything that would result in a child being injured if they fall. For example, coffee tables with sharp edges have no place in a daycare. Outdoor playgrounds should only have toys that are suitable for the age of those in care.
  • Cleaning supplies: Of course, parents want a daycare that is clean and tidy. However, it’s important that any cleaning products are stored securely out of the reach of the children.
  • Toys and other objects: Kids have been injured by objects such as sharp pencils and broken glass.

What should a parent do if their child is injured at daycare? First of all, get medical treatment by a qualified professional. Make sure that the child is stabilized. Next, contact the daycare to find out what happened.

If you are not satisfied with the explanation, find an alternative daycare for your child. If you believe that you are entitled to damages, contact a personal injury lawyer in your area.


Why do you need daycare business insurance?

There are a number of risks associated with running a daycare, whether it’s in your home or in a commercial space. Unfortunately, some people are increasingly pursuing lawsuits when an accident happens. Childcare center insurance will protect you by paying any damages and covering the related legal costs.


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