When caring for children in your home, having the proper insurance is essential. Here are a few considerations when selecting a home day care insurance policy.
What is Home Day Care Insurance?
Home day car insurance, also known as child care insurance, protects care providers from the unique risks at-home day cares may face. While some child care providers may assume their business is covered under their homeowners insurance policy, this is simply not the case. Homeowners insurance policies do not cover risks associated with a home day care business.
Because home-based day cares are not covered under a standard homeowners insurance policy, some insurance companies offer home day care insurance as an add-on coverage. Essentially, you can add this coverage as an endorsement or rider.
Generally, to meet home day care licensing requirements, many states require the provider to carry coverage. For example, Ohio requires home day care providers to have at least $3,000 of aggregate liability insurance.
You could instead buy a business insurance policy for a home day care, but a homeowners insurance endorsement can be a simple way to add coverage.
What Does a Home Day Care Insurance Cover?
Home day care insurance policies may vary depending on the insurance company and your coverage needs. However, usually they have a combination of property and liability coverage options, such as:
General Liability Coverage. For any business that allows the public into its property, general liability insurance is a necessary purchase. This coverage protects you from lawsuits by third parties who are injured while on your property. General liability coverage is especially essential when taking care of children because they tend to get injured easily. While most of the injuries might be minor, some might be severe enough to require medical attention. Therefore, your home day care business is responsible for paying the expenses.
Professional Liability Coverage. Professional liability coverage can protect your business if it’s sued due to negligence. For example, lawsuits can target the physical, mental or emotional abuse of the children in your care.
Commercial Auto Liability Coverage. If your home day care uses vehicles to transport the children, you may be required to have commercial auto liability coverage.
Non-Owned or For-Hire Auto Liability Coverage. If you or a staff member privately drives children to and from school or a field trip, your business might be liable for damage or injuries if a driver is in an accident. This coverage protects privately owned vehicles.
Abuse and Molestation Liability Coverage. Like corporal punishment liability coverage, this covers a home day care if you or your staff are sued over abuse or molestation.
Errors and Omissions Liability Coverage. There’s a chance your day care may face a lawsuit if you’re accused of failure to provide the expected level of care. The error and omissions liability coverages can pay out if you’re found to be responsible.
Umbrella Liability Coverage. Umbrella insurance adds an extra layer to liability limits. If you run a more extensive home day care, this type of coverage is worth considering.
Property Coverage. If you have equipment or property explicitly used for the day care, property coverage can pay out if it’s damaged.
In addition, home day care insurance can provide the parents peace of mind. A good insurance policy can show the parents that you’re a professional provider of child care.
Accidents happen, so it’s crucial to have the proper coverage beforehand. Start by looking at what your home insurance company offers as an add-on to your existing home insurance policy. If it seems insufficient, look to a separate business insurance policy.
Artlce By: Ashley Chorpenning and Amy Danise