Do I need home day care insurance or can I extend my home owners insurance?
This article discusses home daycare insurance specifically for daycare providers in Missouri, Arkansas, Kansas and Oklahoma.
Summary
Homeowners insurance doesn’t fully cover an at-home daycare business.
A custom insurance agency like Loomis Insurance Agency can select from many different policy types to ensure your business’ specific needs are covered.
The cost of coverage can vary greatly depending on your needs and the state your business is located.
State requirements to operate a home daycare business in Missouri, Arkansas, Oklahoma and Kansas.
A home daycare business can be very lucrative and successful, especially considering that many people want the custom attention provided by a home operation. It can also be very fun if you enjoy interacting with children and supporting families.
But, accidents happen in a home daycare business, so it’s important that your business is properly insured. Physical accidents, accidental ingestion of a substance, the spread of normal childhood diseases at the facility or even accusations by parents are all reasons to have insurance that protects both the business and your personal assets.
You can get general liability attached to your current home policy. However, such policies may not cover the issues your business specifically faces. Instead, consider home daycare insurance: a specialized, niche policy that provides coverage for the specific problems daycare providers face. It’s always best to get a policy that’s tuned to the needs of a home daycare insurance and to the regulations in their state.
Home Daycare Insurance Package often includes:
General liability coverage
Professional liability coverage
Property coverage
Does Homeowners Insurance Cover My Home Daycare?
Daycare business owners might be able to cover their home business by extending their homeowners insurance. Some insurance policies will cover a home business for an additional fee, so it’s worth investigating.
The problem with extending homeowners insurance is professional liability. If a child is hurt at your facility and you’re sued by the parents, you could be liable for the child’s medical costs and for the parent’s missed time from work.
Another issue is limits to the number of children you can care for. For instance, some insurance companies only cover a daycare with a max capacity of 6 children. Should your facility go over that number and a child is hurt, they may deny coverage. There are also a number of other limitations that could pose problems for home daycare operations.
What Does Home Daycare Insurance Cover?
Home daycare insurance is a niche insurance targeted just to the needs of a home daycare and fit for the requirements of your specific state. This type of policy provides liability coverage to your business so you’re not personally responsible for damages if a child has an accident while in your care. Most standard homeowners insurance policies do not provide adequate coverage.
Policy options can include:
General liability coverage. This type of coverage can help cover you against medical and legal costs from a lawsuit if a child is injured while in your care.
Accident medical coverage. Covers the medical bills of any children injured in your care, regardless if you’re facing a lawsuit.
Professional liability coverage. This protects your company from harm caused by your staff. A good example would be if one of your staff members accidentally gives a child in your care peanuts when that child is allergic. This type of coverage would help cover the costs of a lawsuit if a parent sues you for damages. A homeowner’s policy and general liability does not cover problems related to staff.
Commercial auto liability coverage. Protection from lawsuits due to auto accidents while transporting children in your care.
Sexual Misconduct Coverage. Abuse and molestation liability coverage if you or a staff member are found guilty of abuse.
Property coverage. Covers damage to your property if it was damaged due to an accident by staff or a child.
Do you need Home Daycare Insurance?
Many states require a home daycare business to carry some liability insurance in order to meet licensing requirements. Licensing requirements are often related to the number of children in your care.
Missouri Home Daycare Insurance
You can provide daycare services for up to 6 children in Missouri without a state license, but your operation still needs to be registered with the state for insurance and subsidy purposes. A parent who wishes to apply for the state’s child care subsidy must only use registered facilities. Registration with the state may also be necessary for some insurance providers.
To register with the state of Missouri, you’ll need to provide:
A background check
Gain a health certificate
Undergo a series of state-mandated training
Comply with a number of other state requirements
When caring for over six children in Missouri (or over three children that are younger than two years old), your facility will need to be licensed. This will represent a more stringent set of requirements. However, being a licensed home daycare facility should decrease your insurance premiums.
For more information about registering as a home daycare facility in Missouri, see:
Arkansas Home Daycare Insurance
The regulations in Arkansas change based on the type of facility you plan to manage and the maximum number of children in your care:
Registered Child Care Family Homes – This is a normal home that cares for 5 or fewer children. These homes are required to adhere to a number of licensing and ADA requirements. They are also required to be insured for at least $100,000 per incident, per child.
Licensed Homes – Homes that care for 6 to 16 children must meet a number of state regulations and win approval of the local health and fire departments if the home provides care for 11 or more children. Such a home may also need city zoning approval. For insurance, Arkansas also requires that the business be insured for at least $100,000 per incident, per child.
Licensed Child Care Centers – These are facilities that care for six or more children. Only programs that operate less than 10 hours a week are exempt from most state rules, but all facilities require health and fire department approval and are subject to city zoning. Insurance levels are a minimum of $500,000 per occurrence.
Out of School Time – These facilities are child care programs that care for school age children only. Insurance levels are a minimum of $500,000 per occurrence.
For more information, see:
Kansas Home Daycare Insurance
Kansas requires most child care facilities to be licensed with the state. Although there is a designation for home daycare facilities, the maximum number of children that can be enrolled in an unlicensed home daycare facility is two and those children must be from the care provider’s neighborhood and be cared for no more than 20 hours a week.
Thus, most home daycare programs in Kansas should consider designation as a “licensed daycare home”. This allows the provider to care for up to 10 children. The provider must undergo background checks and have proof of adequate liability insurance.
For more details about Kansas rules for an in-home daycare business, please see:
Oklahoma Home Daycare Insurance
All daycare facilities must be licensed in the state of Oklahoma. This includes home daycare facilities and facilities located in a commercial building. The type of license depends on the number of providers, the type of location, and the number of children. For instance, a “family child care home” is licensed to have a maximum of 7 children, where a facility licensed as a “large family child care home” can have up to 12.
Oklahoma licensing rules also vary based on the type of services offered. Businesses that offer overnight care are licensed differently from facilities that strictly operate during the daytime. Licensing also varies if there is outdoor play equipment or if there are children present who are related to the care provider.
For insurance, Oklahoma allows facilities to self insure. However, we strongly suggest reviewing Oklahoma’s law on self insurance with a lawyer or an insurance agent. Self insurance is complicated and opens up a provider to serious liability, should there be a claim.
Otherwise, Oklahoma requires facilities to have a general liability policy that provides at least $200,000 in insurance per occurrence. Providers need to prove to the state that they reviewed their policy with their agent yearly and that they continue to meet coverage requirements.
For a full list of all Oklahoma rules for home daycare facilities, please see:
Need Help Setting Up a Home Daycare Business?
Running a home daycare business is complicated enough. When considering insurance, you need an insurance agent committed to your business.
The Loomis Insurance Agency is not an insurance broker. We are an independent agency focused on doing business in Missouri, Oklahoma, Kansas and Arkansas. This allows us to understand the special rules in those states and tailor an insurance policy specifically for your business and specifically in those states.
To set up a phone call with a Loomis insurance specialist, please call 800-743-7205 or click the following link and fill out our contact Us form.
Loomis Insurance is committed to servicing you.