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Whether you are licensed for 6, 8, 12, or 14, your insurance needs as a child care provider are very similar to each other. Depending on your licensed capacity, there are different ways for you to get the insurance you need. |
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If you are licensed for six, you may be able to get coverage through your homeowners or renters insurance policy's Comprehensive Personal Liability. |
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The CPL is usually offered in coverage limits ranging from $100,000 to $1,000,000. You should make sure that your CPL is endorsed to include teachers professional liability and incidental business liability. This can be the least expensive way for you to get some coverage (somewhere around $200 annually). The CPL is a personal form of liability insurance. |
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The down-side of doing this is that a CPL policy limits your coverage to within 100 feet of your premises (so field trips and walking trips are out). Coverage may not extend to acts of your employees or relatives living in your home. If someone is working for you and they are named in a lawsuit as a result of something that they did for you, their legal defense and any judgement levied against them usually is not insured. The bottomline is that your employee may be forced to sue you. If you have a business name, it is not covered. The named insured of a CPL is exactly the same as the named insured on your homeowners/renters policy (e.g., John and Jane Doe HW/JT). |
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Coverage through a Comprehensive General Liability policy is available for facilities of all sizes. $300,000 coverage can cost as low as $250 annually, depending on your licensed capacity. The CGL is a commercial form of liability insurance. |
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The CGL will allow you to use a business name (e.g., LMNOP Child Care), protects you at an off-site location, and extends coverage to acts of employees. |
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It should also protect you against lawsuits, including your legal defense. Your CGL liability coverage should include premises, products, completed operations, personal injury, libel, slander, defamation of character, false arrest, false imprisonment,advertising injury, incidental contractual, employees as additional insured, sexual abuse, physical abuse, assault, battery, teacher's professional, and incidental medical payments. |
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Generally speaking, the CPL lists what is excluded and the CGL lists what is covered. In theory, there is more coverage with a CPL; in practice, the CGL is more useful. |
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Coverage for your property is not included. Since you are doing business in your home you can get coverage for your business equipment by having your homeowners or renters insurance policy endorsed to include incidental business property. As an example, $10,000 of equipment should cost you $10-$20 extra per year. It's important to have this endorsement since business property is excluded in your homeowners or renters policy. |
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Workers Compensation Coverage is not included. This coverage is required by law even if you have only one part-time employee. Contact the State Fund (listed in the State of California Government white page listing - usually under Department of Industrial Relations). They have a $200 minimum annual premium. Read more about workers compensation. |
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Vehicle Coverage is not included. If transporting children is part of your child care service, you are doing livery. Livery is transporting passengers for a fee. Your personal auto insurance policy usually excludes livery. Your employees probably have no livery coverage either, so don't count on them to shift liability that will end up at you. Our policy includes medical payments for injuries children might sustain while in a vehicle, but this is not liability coverage and although our medical payment limit is at least $5,000, in a serious incident, it will not be enough to protect you. Read more about vehicle insurance. |
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