Child Care Insurance Guide: Coverage, Carriers & Costs for 2026

Most businesses require some form of insurance to protect them from financial risk in the event something goes wrong, and caring for children is an especially sensitive area for liability. Thus, child care businesses must secure and maintain the proper types of coverage before taking children into their care, with many states even mandating base levels of coverage.

Different risk mitigation approaches will apply to different child care businesses, depending on factors such as the number of children in their care, the facility, the number of locations, the activities and scope of services, local cost of living and other factors. If you have a staff, you will likely also need to account for additional coverage.

Some basic types of insurance that may apply to your child care business include:

• General liability

• Professional liability

• Property insurance

• Workers' compensation

• Vehicle insurance (if transporting children)

• Abuse & molestation

• Umbrella insurance

Other specialty policies might also be applicable. This article explains the purpose and parameters of each type of insurance, including cost ranges for different types of child care businesses. 

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Types of Business Insurance for Child Care Operations

Not every type of business insurance will apply to your specific needs, but all child care businesses should evaluate the appropriateness of the following types of coverage.

General Liability Insurance

General liability is the foundational coverage every child care business needs. It protects you if someone is injured on your property or if your business causes damage to someone else's property. Think: a child slips on a wet floor, a parent trips in your parking lot, or a child accidentally breaks something at a field trip location. It also covers your legal defense costs if you're sued over these kinds of incidents. Most states require it as part of your licensing.

Professional Liability (also called Errors & Omissions)

Where general liability covers physical accidents, professional liability covers claims that your services caused harm. In child care, that means allegations that a child was improperly supervised, that your staff failed to follow a care plan or allergy protocol, or that your program didn't meet its duty of care – even when no physical injury occurred. It's the coverage that protects you from "you should have known better" claims.

Property Insurance

This covers your physical possessions, such as furniture, equipment, toys, computers, and the building itself if you own it. If a fire, storm, flood, or break-in damages or destroys your space and its contents, property insurance is what helps you recover and reopen. If you're renting, your landlord's policy covers the building structure, but it does not cover anything inside that belongs to you – that's on your policy to protect.

NOTE: A Business Owner’s Policy, or “BOP”, may be suggested in some cases and generally covers both general liability insurance and property insurance.

Workers' Compensation

Required in most states the moment you hire your first employee. It covers medical expenses and lost wages for any staff member who gets hurt on the job. Imagine a teacher throws out her back while lifting a child, or a staff member who slips in the kitchen. It also protects you as the employer from being personally sued for a work-related injury. The cost scales with how many employees you have and what your total payroll looks like.

Vehicle / Commercial Auto Insurance

If your program transports children at any point – whether for pickups, drop-offs, field trips, or even occasional outings – you need a commercial auto policy. Personal auto insurance explicitly excludes business use, meaning an accident on a field trip could be entirely uncovered without it. This applies whether you own the vehicle, rent one, or have staff members driving their personal cars for program purposes (in that case, you'd want what's called non-owned auto liability). If you transport children, this coverage is non-negotiable.

Abuse & Molestation  

Also called Sexual Abuse & Molestation or SAM coverage, this may be one of the most commonly overlooked options for coverage in child care insurance. Some directors don't realize until it's too late that standard general liability policies almost universally exclude abuse and molestation claims, meaning an allegation of inappropriate conduct could leave your program entirely unprotected. SAM coverage fills that gap, covering legal defense costs and liability arising from claims of physical or sexual abuse by any staff member, volunteer, or even another child in your care, regardless of whether the allegation is proven. Any insurer that specializes in child care will offer it, and many licensing agencies require it.

Umbrella Insurance

An umbrella policy sits on top of your existing coverage — general liability, professional liability, commercial auto — and kicks in when a claim exceeds those underlying policy limits. For most small, single-location programs with solid primary coverage, it's not the first priority. But for larger operations, multi-site centers, or programs that transport children regularly, a single catastrophic incident involving multiple children could exhaust a standard $1M or $2M limit faster than you'd expect — and an umbrella policy is what stands between that gap and your personal or business assets. Relatively affordable at a few hundred to a couple thousand dollars per year for $1M–$5M in additional coverage, it's a smart add-on for any director running a higher-exposure operation.

Carefully evaluate the activities your child care business will be partaking in. In special cases, you may seek out additional or alternative coverage beyond what is listed above. Consider consulting with a lawyer or a specialized insurance agent if you have questions about how insurance applies to special circumstances.

Cost of Insurance for Child Care Businesses

Keep in mind, the specific cost and efficacy of your insurance suite will depend on your specific business and preferences. Key factors that might affect your specific cost include:

• Number of children enrolled (more kids = higher risk = higher premium)

• Location (urban or high-litigation states may cost more)

• Number of employees and total payroll

• Your claims history and safety record

• Coverage limits you choose (e.g., $1M vs $2M per claim)

• Whether you transport children 

Cost estimates for daycare insurance suites are estimated below with specific range breakouts for the type of insurance and also aggregate estimates for different types and sizes of child care businesses. Remember, actual premiums vary significantly based on your specific business and risk management practices. Home-based operations are generally at the lower end; larger commercial or multi-site centers are at the higher end.

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Child Care Insurance Cost by Type of Insurance 

These cost ranges are annual approximations based on a variety of child care business types. Additionally, further breakdowns by business type (family/home-based, center-based, and large/multi-site) are listed below. 

Total Child Care Insurance Cost Range Estimates by Business Type

Because the range of potential insurance costs run the gamut, this chart details estimated annual ranges for specific types of child care businesses.

Especially for large or multi-site operations, costs will scale with total revenue, enrollees, staff, payroll, square footage, locations, and other factors. Keep in mind, you will want to continuously review your insurance strategy each year to make sure you have the appropriate policies and coverage amounts as your business grows and changes.

How to Get Insurance as a Child Care Provider

You’ll often have to solicit a quote online or otherwise call an insurance broker to secure the appropriate insurance coverage for your business. Some insurance companies cater specifically to child care businesses, so they will already have a good understanding of what types of questions to ask about your business and what types of coverage might make the most sense for your circumstances.

Business Insurance Recommendations for Child Care Providers

Some insurance carriers that cater to child care and daycare businesses include:

Philadelphia Insurance Companies (PHLY)
Apply for a quote: https://www.phly.com/campaign/childcarequote 
Phone: 800.873.4552 

PHLY's Child Care Package is purpose-built for child care centers, preschools, daycares, and after-school programs, covering both nonprofit and for-profit operations. They have over 20 years of experience writing child care policies, hold an A++ (Superior) AM Best rating, and process most quotes within two to three business days. Widely considered the gold standard for child care-specific coverage. It works through appointed independent brokers, but you can request a quote directly through their website. 

Markel Insurance
Find an agent: https://www.markel.com/us/industries/child-care-and-enrichment/commercial-child-care 

Markel has over 30 years of experience in the child care and enrichment space and offers customizable policies for everything from in-home daycares to tutoring services, with flexible payment options. Coverage includes GL, umbrella, sexual abuse/molestation, corporal punishment, professional liability, communicable disease/food contamination, and property. Markel coverage is secured through appointed agents. 

West Bend Mutual Insurance
Find an agent: thesilverlining.com/business-insurance/childcare 

West Bend is designed for daycare centers, preschools, and before-and-after-school programs and works through independent agency partners. They insure more than 7,000 child care centers across Midwestern states. Currently available in Arizona, Illinois, Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota, Missouri, North Carolina, Ohio, Tennessee, Virginia, and Wisconsin – so it’s not the right fit if you're outside those states. 

SECURA Insurance
Find an agent: secura.net/business-insurance/commercial-daycare-insurance

SECURA's commercial child care insurance is designed for licensed or certified commercial child care centers, including 4K and 5K programs, and includes supplementary coverages and loss prevention resources. SECURA is a regional carrier that also works through independent agents.

Assure Child Care
Apply for a quote: https://www.assurechildcare.com/child-care-insurance-quote/ 

Assure Child Care is a nationwide specialist focused specifically on in-home and family child care providers, with over 40 years of experience. Their program includes General Liability and Accident Insurance and operates within the Adults & Children's Risk Purchasing Group. This might be a good option if you're running a home-based program rather than a commercial center.

Insureon
Shop for a quote: insureon.com/human-social-services-insurance/daycare-centers  

Insureon is an online broker platform – not a carrier itself – that allows daycare providers to compare quotes from multiple top-rated insurers and potentially get coverage the same day they apply. This may be a good starting point if you want to shop multiple options quickly without calling around. This likely works best for smaller programs that fit a standard risk profile.

Get your child care business started on the right foot by organizing your operations and compliance with the Playground app. You can book a personalized demo for free.

The Bottom Line

Securing proper insurance is essential for protecting your child care business, your personal assets, and the children you serve – and it is often required for licensing. Annual costs typically range from $2,500–$6,000 for home-based and small programs, $5,000–$18,000 for small center-based operations, and $8,000–$60,000+ for large or multi-site facilities, depending on size, location, transportation, limits, and claims history. To find appropriate coverage, list your exact operations (number of children, staff, transportation, activities, etc.), get quotes from at least three to four childcare-specialized carriers, and review your policies annually.