Meaning:

You are responsible for a loss because of negligence and/or you are sued and the courts hold you responsible and/or you have a contract that says you are responsible.

 

Examples: 

1. You are preparing a snack for the child and while your back is turned a child falls out of their chair, bumps their head and requires stitches.

2. A child brings their expensive doll to daycare and another child breaks it.  The parents decide to sue you holding you responsible for the damaged toy.

 

Important Information:

There are several different types of liability coverage and you need to make sure you have all of the types that could pertain to you.  Homeowner’s policies that provide liability coverage for your daycare often exclude many types of liability such as professional liability and sexual molestation, physical and mental abuse coverage.  See descriptions below.

 

 

Types of Liability Insurance:

The following types of coverage are not covered on all liability policies.  This is why it is important to review your policy to see that you are properly covered.

 

General Liability:  covers property damage and bodily injury.  Some insurance companies include sickness, disease, mental anguish or emotional distress in their bodily injury definition.

 

Professional Liability: provides coverage for damages and defense should a claim arise from professional services you provide. Covers many gaps in general liability coverage.

 

Personal Injury Liability: provides defense coverage should a person attack your reputation by means of false arrest, libel, slander, malicious prosecution, wrongful entry or eviction etc.

 

Defense Coverage:  Pays for your legal defense in the event of a lawsuit.  Many policies include this coverage in addition to the policy limit so your liability coverage is not reduced.

 

Molestation or Abuse Liability: provides coverage for any suit arising from alleged, threatened or actual molestation or abuse.

 

Alienation of Affection: This protects you in the event you are sued for “stealing the affection and control” of a child from their parent or legal guardian.

 

Contractual Liability: This covers any written obligations and agreements.  For example any field trip or medical forms provided by you that cause a lawsuit.

 

Field Trips/Off Premised Activities:  This provides coverage when you are away from your premises.

Products Liability: Includes preparing and serving food to the children.

 

 

Medical Payments:

Provides coverage up to the specified limit with no deductible for medical costs within one year of the date of the accident due to injuries.  This is different from your liability coverage because it provides coverage with no fault attached.  Medical Payments does not include coverage while in your vehicle.  You auto policy should provide coverage if in a vehicle.

 

 

Property Coverage:

Property coverage covers your business personal property and property of others that is in your care at your location.  Property coverage is tailored to your needs depending on:

 

· Own or lease your location

· How much personal business property you have (toys, games, furniture, equipement, supplies, computers, etc)

· Playground equipment

· Swimming pool

· Any other unique property owned and used by your business

 

 

Worker’s Compensation:

Worker’s compensation covers employees in the event they are injured while on the job.  Worker’s compensation is required by law if you have 1 or more employee.  The premium is based on your payroll and is audited each year by the insurance company to be sure the correct payroll numbers were used.  Some companies offer continuous audit which allows them to adjust your worker’s compensation premium as your payroll changes.

 

 

Business Auto:

If a vehicle is used to transport children at any time while in your care you need to have business auto coverage.  Business auto policies have similar coverages to your personal auto policies.  Typically the coverage limits are higher on your business auto policy and have more optional coverages to add.

 

 

 

Feel free to contact our insurance professionals to discuss these or other coverages further.

 

866-535-2761

 

Below we will define some common insurance terms and coverages used in childcare insurance.

Coverage Explanation

Liability Insurance:

Probably the most important coverage you can have.  It is the least understood by people, which means childcare businesses are frequently not covered as they think they are or as they should be.  Liability insurance is a license requirement.

 

Definition:

Insurance that pays and renders service on behalf of an insured for loss arising out of his responsibility, due to negligence, to other imposed by law or assumed by contract.