If you run a daycare—whether it’s an in-home program or a larger child care center—insurance can feel like one more complicated thing on an already full plate. And it’s not always obvious what you truly need, what’s “nice to have,” and what only applies to certain setups (like having employees or offering transportation).
This guide breaks down the most common types of insurance for daycare providers. You’ll get a quick education on the essential coverages most daycares start with, plus a few add-ons to consider if you have staff, transport children, or keep digital records.
Because licensing rules, landlord requirements, and carrier guidelines can vary by state and even by county, think of this as a practical starting point. The goal is to help you avoid gaps, stay compliant, and get coverage that fits your daycare and your budget without overpaying.
Quick Checklist
Essential for most daycare providers
- General Liability (including Accident Medical Coverage)
- Professional Liability
- Abuse & Molestation Coverage
- Property Insurance
- Business Interruption Coverage
If you have employees…
- Workers’ Compensation
- Employment Practices Liability Insurance (EPLI)
If you offer transportation…
- Commercial Auto Insurance
- Transportation Coverage / Non-Owned Auto Liability
If you maintain digital records…
- Cyber Liability
Essential Insurance For Daycare Providers
These are the coverages that are essential for most daycare providers, as they address the most common risks: injuries, allegations related to supervision, protection for your space and supplies, and the financial hit of an unexpected closure.
1. General Liability Insurance
General liability is the foundation for most daycare insurance plans. It can help protect your daycare if a child, parent, or visitor is injured on-site or if you’re accused of causing damage to someone else’s property.
Many daycare policies also include Accident Medical Coverage, which can help pay for medical expenses from certain injuries, regardless of fault. For daycare owners, this can be especially helpful for the “everyday” mishaps that can happen even with great supervision.
2. Professional Liability Insurance
Professional liability (sometimes called errors and omissions) focuses on claims related to the care you provide—like allegations involving supervision decisions, incidents during activities, or other professional services you perform as a childcare provider.
Even when you run a careful, well-managed program, misunderstandings and allegations can happen. Professional liability is designed to help protect your business in those situations, subject to the terms of the policy.
3. Abuse & Molestation Coverage
This coverage is often included with—or added to—daycare liability policies because it’s a sensitive but important part of childcare risk management. It’s also commonly requested by licensors, landlords, and other partners.
The key point: this coverage is designed to help protect the business if a claim is made, and it’s one reason daycare insurance should be written specifically for childcare operations.
4. Property Insurance
Every daycare has physical property at risk—whether it’s a dedicated center building or a room in your home set up for childcare. Property coverage is what helps protect the things you rely on: furnishings, learning materials, toys, equipment, and (in some cases) the building itself.
For in-home daycares, property protection may be handled through a daycare-specific policy and/or an endorsement—because homeowners insurance may not cover business-related property or losses the way you expect. For centers, property insurance is often written as commercial property coverage due to higher limits and broader exposures.
5. Business Interruption Coverage
If a covered loss (like certain types of property damage) forces you to temporarily close, business interruption coverage can help with lost income and certain ongoing expenses while you recover.
For many daycare providers, this is what turns an unexpected shutdown from a major financial crisis into a manageable disruption—especially if you still have rent, payroll, or other bills coming due.
If You Have Employees…
Once you have employees, your insurance needs usually expand—both because staffing can trigger legal requirements and because employment-related claims are a different category of risk.
6. Workers’ Compensation
Workers’ comp is commonly required by state law once you have a certain number of employees. (For example, Florida law requires daycares to carry it once they have four or more employees.) It’s designed to help cover medical expenses and lost wages if an employee is injured on the job. In a daycare setting, that could include things like lifting injuries, slips and falls, or other workplace accidents.
7. Employment Practices Liability Insurance (EPLI)
Even well-run childcare businesses can face disputes as they grow, especially as hiring, scheduling, and discipline decisions become part of day-to-day operations. EPLI can help protect your daycare from certain employment-related claims, such as wrongful termination, discrimination, harassment, or retaliation.
If You Offer Transportation…
If your daycare transports children—or if there’s any chance a vehicle could be used for daycare business—this is an area you don’t want to guess on. The right coverage depends on who owns the vehicle and how it’s being used.
8. Commercial Auto Insurance
If your daycare owns a van or bus, you’ll typically need a commercial auto policy for that vehicle. Personal auto insurance policies aren’t intended for business-owned vehicles or regular business transportation, and it may not respond the way you expect if a claim occurs while transporting children.
9. Non-Owned Auto Liability
Even if you don’t own a daycare vehicle, transportation risk can still exist. Non-Owned Auto Liability can help protect your daycare if an employee uses their personal vehicle for daycare business or if you rent one (for example, running daycare errands or transporting children for a field trip). It’s designed to help cover the daycare’s liability if the business is brought into a claim.
If You Maintain Digital Records…
Most daycare providers keep at least some information digitally: enrollment forms, emergency contacts, immunization records, billing details, or parent communication. That data is part of your operation, and it can create risk, even for small in-home programs.
10. Cyber Liability
Cyber Liability can help with certain costs tied to a cyber incident, like a data breach, ransomware attack, or other privacy/security issue. Depending on the situation, that may include things like notification requirements, credit monitoring services, data recovery, and legal or regulatory-related expenses.
Even if you don’t think of your daycare as “high tech,” if you store sensitive family information or take payments online, cyber coverage is worth a look, especially as these incidents become more common for small businesses.
The Protection You Need
Choosing insurance for daycare providers shouldn’t feel like guesswork. That’s where FDCI comes in. We do one thing: child care insurance. Instead of a one-size-fits-all business policy, we help you build coverage around how your daycare really operates.
We’ll walk through what’s required, what’s essential, and where you may be able to save money without creating gaps. Our goal is simple: help you stay protected, stay compliant as requirements change, and get coverage you can feel good about at a price that makes sense.
Want a quick, straightforward quote? Contact FDCI and we’ll help you find the right coverage for your daycare. You care for them. We care for you.
