Best Daycare Business Insurance

The Hartford secures our top spot for daycare center insurance with perfect scores across coverage options and affordability. Its coverage packages and cost-effective rates set them apart in the childcare insurance market. 

You should also get quotes from our other recommended carriers, including ERGO NEXT, biBerk, Simply Business, and Progressive Commercial, before making your final decision.

*We based all scores on a daycare business with two employees across professional liability, general liability, workers' comp and BOP policies.

The Hartford leads daycare insurance affordability at $43 monthly, offering the cheapest business owner's policy and general liability coverage. But ERGO NEXT provides more affordable workers' compensation at just $13 monthly, making it worth considering for this specific coverage type.

In general, daycare business insurance costs are the following for the four most popular coverage types:

• General Liability: $33 on average per month, ranging from $29 to $46, depending on the state
• Workers' Compensation: $13 on average per month, ranging from $11 to $16, depending on the state
• Professional Liability: $108 on average per month, ranging from $92 to $125, depending on the state
• Business Owners' Policy Insurance: $49 on average per month, ranging from $41 to $56, depending on the state

Important coverage types and recommended limits for daycare and childcare operations include:

• General liability insurance: Covers third-party injuries and property damage. Playground falls and parent property damage are the most common daycare claims. Home-based daycares need $1 million per occurrence and $2 million aggregate. Commercial centers need $2 million per occurrence and $3 million aggregate.
• Workers' compensation insurance: Legally required in most states with employees. This pays medical costs and lost wages for staff injuries. Back strains from lifting toddlers, knee injuries from floor time and falls during outdoor supervision are common. Required limits depend on your state and payroll size.
• Professional liability insurance (errors & omissions): Covers claims of inadequate supervision, medication errors and safety protocol failures. Small daycares need at least $1 million per occurrence or aggregate. Larger facilities need $2 million to cover negligence claims and meet contract requirements.
• Business property insurance: Covers playground equipment, educational supplies, furniture, technology and the building if you own it. Home-based daycares need $15,000 to $25,000 in contents coverage. Commercial centers need $50,000 to $150,000 depending on facility size and equipment value.
• Commercial auto insurance (if applicable): Required if your daycare owns vehicles for field trips or transportation. Industry standard is $1 million combined single limit with comprehensive and collision coverage.
• Abuse and molestation coverage: Required by an increasing number of state licensing boards. Start with $1 million per occurrence and $2 million aggregate. High-litigation states or larger facilities should carry $2 million per occurrence to cover legal defense and settlements.

Use this guide alongside these steps to find daycare coverage without overpaying:

The Hartford ranks first for daycare insurance. Also quote ERGO NEXT, biBERK and Simply Business for comparison. Use agents familiar with childcare operations, benchmark costs for facilities like yours and compare at least three providers before deciding.

We answer frequently asked questions about daycare business insurance:

Insurers were scored across four categories:

• Affordability (50%): Premiums compared against competitors using a base profile across four core coverage types. Lower cost relative to competition scores higher.
• Customer service (30%): Scores draw from industry satisfaction studies, customer review platforms and public forum sentiment including Reddit.
• Coverage (15%): Scored on flexibility, payment options and the breadth of actual coverage available.
• Financial stability (5%): AM Best and Moody's ratings used to assess each insurer's ability to pay claims relative to competitors.

All pricing in this article is based on the following base profile to represent the vast majority of small businesses in all states:

• Three-person business with two employees
• Coverage: $1 million per occurrence and $2 million total per year for all but BOP, which includes the same coverage plus $5,000 of business property coverage
• $150,000 in payroll
• $300,000 annual revenue