Home Daycare Insurance

Q: How much is insurance for in-home daycare?

In-home daycare insurance typically costs between $400 and $1,200 per year, depending on location, number of children, and coverage limits.

Q: What type of insurance is needed for a daycare?

Daycares usually need general liability insurance and often professional liability coverage; in-home daycares may also need a special endorsement or rider on their homeowners policy, or a separate commercial policy.

Q: Why is daycare insurance so expensive?

Daycare insurance is costly because providers face high liability risks related to child safety, medical emergencies, and potential lawsuits, which increases premiums for adequate coverage.

Standard home insurance doesn't cover daycare risks. Home daycare insurance covers liability, property damage, and business risks that homeowners policies exclude - it's also often required for licensing (as well as peace of mind).

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By Ross Martin

Updated December 1, 2025

Reviewed By Beth Swanson

Edited By Renata Balasco

What insurance is required for a home daycare center?

If you run a childcare facility, insurance is vital. This is especially true if you run a daycare in your own home. Children are vulnerable, and accidents do happen. Carrying insurance that protects you and those in your care is essential.

In order to operate a home daycare business, you will need a daycare insurance policy. Don’t expect your homeowners policy to provide all the coverage you need. This can leave huge gaps in your liability coverage and put you at risk.

So what are the best options for home daycare insurance? Read on to learn how to ensure your in-home daycare is comprehensive.

Jump to

What is home daycare coverage?
Coverage
What is right for you?
Exclusions
Considerations
FAQs

What makes daycare coverage unique?

Most often, home daycare coverage can be added to your homeowners insurance policy as an endorsement. This add-on extends your liability to cover those in your care. This coverage will typically extend property coverage to the property from which your home daycare operates.

Eligibility for a home daycare insurance endorsement is often determined by the size of your childcare business. Most insurers limit the number of children that can be in your care. The maximum number may vary from one homeowners insurance company to another, but usually falls somewhere between three and six children. If your home daycare's enrollment exceeds this maximum, you should look into a commercial insurance policy.

What does home daycare insurance cover?

Home daycare insurance coverage can vary a bit depending on your state and your insurance company, but most policies share a few key features. One of the biggest changes is higher liability protection — this extends your homeowners liability coverage to include accidents or injuries related to your daycare. If a child in your care gets hurt and a lawsuit follows, that extra coverage can help protect you financially.

Most policies also include medical payments coverage, which pays for injuries to non-residents who get hurt at your home — like children in your care or their parents during pickup. This can cover things like doctor visits, ambulance rides, surgeries, or dental work.

In many cases, your daycare coverage also extends to business-related property, such as toys, furniture, or playground equipment. When you add a home daycare endorsement, the small business property limit (usually around $2,500) is replaced by your full personal property coverage — giving you more protection for the items you use every day.

Homeowners Policy Endorsements Guide | The Zebra

Explore homeowners insurance policy endorsements to customize your coverage. Learn about add-ons like earthquake, sewer, and mold to protect your home.

What insurance is right for your home daycare?

Whether or not you need home daycare coverage depends on the nature of your business.

If you babysit a nephew or a grandchild, it’s unlikely this endorsement is necessary. Similarly, your childcare is not considered a business if money doesn't change hands, in which case the liability portion of your homeowners insurance should — in most cases — suffice. If money is exchanged, you will need to acquire a daycare insurance endorsement.

The coverage you choose also depends on the scale of your home daycare. If you already have a number of children in your care or have plans to expand your business, consider a commercial policy separate from your homeowners insurance.

A standard home daycare endorsement only applies if you're the sole proprietor. If your business expands and you hire additional employees, you should acquire a commercial insurance plan.

Home daycare insurance exclusions

Home daycare endorsements can be quite restrictive. State requirements or insurance company guidelines usually dictate strict limits on the number of children (not including your own) that can be under your care. In-home care of adults is typically disallowed from this policy endorsement.

Some playground equipment may be classified within this category, making you ineligible for coverage.

Things to know before buying home daycare insurance

When choosing insurance for your home daycare, there are a few important details to keep in mind. For example, if you plan to use your car for daycare purposes — like transporting children — you’ll likely need a commercial or business auto policy. Standard car insurance often won’t cover accidents that happen while driving for work.

Most home daycare endorsements added to a homeowners policy offer only limited coverage. They may not include protection for serious claims like corporal punishment or abuse and molestation liability. You may also have an aggregate limit, which is the maximum amount your insurer will pay for all covered claims within a year. Once you hit that limit, you’re responsible for any remaining costs.

Because of these limits, it’s worth exploring a commercial daycare insurance policy, especially if your business is growing or you care for multiple children. A full commercial policy can provide broader protection — for you, your property, and the families who trust you with their kids.

When it comes to insurance, we have you covered.

Home daycare insurance FAQs:

How much is insurance for in-home daycare?

In-home daycare insurance typically costs between $400 and $1,200 per year, depending on location, number of children, and coverage limits.

What type of insurance is needed for a daycare?

Daycares usually need general liability insurance and often professional liability coverage; in-home daycares may also need a special endorsement or rider on their homeowners policy, or a separate commercial policy.

Why is daycare insurance so expensive?

Daycare insurance is costly because providers face high liability risks related to child safety, medical emergencies, and potential lawsuits, which increases premiums for adequate coverage.

About The Zebra

The Zebra is not an insurance company. We publish data-backed, expert-reviewed resources to help consumers make more informed insurance decisions.

The Zebra’s insurance content is written and reviewed for accuracy by licensed insurance agents.
The Zebra’s insurance editorial content is not subject to review or alteration by insurance companies or partners.
The Zebra’s editorial team operates independently of the company’s partnerships and commercialization interests, publishing unbiased information for consumer benefit.
The auto insurance rates published on The Zebra’s pages are based on a comprehensive analysis of car insurance pricing data, evaluating more than 83 million insurance rates from across the United States.