Does Your Toronto Daycare Have Enough Liability Insurance?
The cornerstone of your Toronto childcare centre insurance program is having enough business liability insurance to protect it financially from lawsuits and claims.
A lawsuit against your daycare centre can damage its reputation, drain it financially, and even force it to close. Business liability insurance financially protects Toronto daycares against lawsuits. Do you have enough liability insurance?
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We make the process easy by getting insurance quotes for you to choose from and giving you policy coverage options that suit your Toronto business’s specific needs.
Why do Toronto daycares need business liability insurance?
Your daycare needs liability insurance to protect against financial losses due to lawsuits or claims related to accidents, injuries, or negligence involving children or staff. Business liability insurance covers legal fees, settlements, and medical expenses if a child is injured or if a parent claims your Toronto daycare centre was negligent in caring for their child.
What are the top business liability insurance coverages needed for Toronto childcare centres?
Commercial general liability (CGL) insurance
CGL insurance can cover your Toronto childcare centre for lawsuits alleging personal injury to a child or anyone visiting your childcare, false advertising, and libel or slander.
- Commercial general liability insurance typically covers medical fees, legal expenses, and settlements regardless of the outcome of a lawsuit by a customer against you.
- Your CGL insurance policy should protect you from libel, slander, copyright infringement, and false advertising allegations.
Without commercial general liability insurance, you would be responsible for paying any liability costs out of your own pocket.
Abuse liability insurance
Your Toronto daycare could face allegations of physical, sexual, and emotional abuse. Abuse liability insurance helps your daycare defend itself against these allegations.
Abuse is usually defined as an act or threat involving molestation, harassment, corporal punishment, or any other form of physical, sexual, or mental abuse.
Professional liability insurance
This type of insurance is also known as errors and omissions (E&O) insurance. It protects your Toronto daycare employees. Employees can make mistakes at any given time, or parents may misunderstand the terms of your daycare services. For example, a parent can decide to sue for financial loss, misconduct, negligence, or failure to deliver services as advertised at your daycare.
Cyber insurance
If you store data on the children at your Toronto daycare such as medical information, you musts protect this information and can be held liable if you don’t. Do you take online payments for services?
If your computer system is hacked, cybercriminals can sell the information. Without cyber insurance, you will have to pay out of your pocket for the cost of restoring your system. You may also be liable for damages to third parties whose information has been stolen and you may have to pay for notification expenses to inform parents affected by a breach.
Directors and officers insurance
If your Toronto childcare centre has a board of directors, you will need directors and officers liability insurance to protect your board from claims of negligence. Individuals serving on your board of directors can be sued for the actions of your daycare centre.
What other insurance do Toronto childcare centres need?
Commercial property insurance
Commercial property insurance covers the furniture, equipment, and supplies that your daycare uses in its day-to-day operations if they are lost or damaged due to an insured event, such as a fire, theft, flood, or vandalism.
To protect your Toronto daycare in the event of a sewer backup or flooding, you should consider adding sewer backup or overland flood coverage extensions, which standard business insurance policies typically do not cover.
Business interruption insurance
Business interruption insurance supports you when your Toronto daycare can’t operate due to a covered loss, such as repairs. This type of insurance can mean the difference between recovering from a loss and closing your daycare permanently. It’s usually added to a commercial property insurance policy as an endorsement or rider.
Some examples include:
- Damage from fire or vandalism
- Damage to a neighboring business
Business interruption insurance can help with expenses such as:
- Payroll
- Rent
- Utilities
- Property taxes
- Alarm monitoring
- Relocation of your childcare centre
Equipment breakdown insurance
This type of insurance provides coverage for property damage from the sudden and accidental breakdown of insured equipment not automatically covered by a standard commercial property policy. You’ll need to have a list of the equipment, such as your furnace or freezer, at your Toronto daycare and how much they are worth.
How much daycare insurance do I need and how much does it cost?
It will depend on the size of your daycare, licensing, services provided, training and experience, number of employees, and claims history. The cornerstone of your childcare centre insurance program is having enough business liability insurance to protect it financially from lawsuits and claims.
It’s unlikely that all commercial or home daycare businesses in Toronto would pay the same monthly or annually for their childcare centre insurance coverage due to their size and services provided.
What do I do if I have a claim against my Toronto childcare business?
Contact your broker immediately after any business-related mishap. Waiting to file a claim can confuse insurers about the severity of the damages to your business.
- Know your policy so that when you contact your broker you are familiar with what will be covered or not.
- Document the damage. Take photos right away and write down what happened.
- Do not throw away damaged goods after taking photos. Keep the physical evidence so that your adjustor can see it.
- Do not invite lawsuits. Don’t say anything that could be used against you, especially if you aren’t sure what happened.
- Be honest about what your damaged property is worth. Damaged commercial property is generally valued according to its actual cash value or replacement value.
Here’s an insurance checklist:
- Do you have the best Toronto business insurance rate that suits your work?
- Do you have the right amount for your deductible and regularly review it to make sure it’s the right amount for you?
- Are you or your employees using personal vehicles for work?
To sum it all up
In order to protect the children at your Toronto childcare centre and the centre itself, you need to have adequate business liability insurance coverage. Lawsuits are usually expensive and can potentially force your daycare to close. Liability insurance helps cover legal costs and settlements, giving your daycare financial protection when you need it the most.
Western Financial Group has licensed BUSINESS INSURANCE EXPERTS to get you the right insurance coverage as a Toronto daycare operator. Our experts are available now to help you navigate the business insurance journey to protect your Toronto business.
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5 FAQs about daycares and insurance
How should I choose a daycare?
Ask about the daily routine for children attending the daycare, child-to-caregiver ratio, staff qualifications, health and safety protocols, abuse complaints, and how they deal with allergies, discipline, and emergencies. Also asked about what lunches and snacks are served daily.
Should a daycare be licensed?
Daycares that look after more than five children under the age of 13 usually must be licensed. A licensed daycare regulated by provincial regulations sets standards for staff qualifications, child-to-staff ratios, safety, and other operational aspects. Licensing usually includes childcare centres, daycares, and home daycares.
Should a daycare be insured?
Daycares should be insured. Most provinces and territories in Canada require licensed daycare operators to carry liability insurance, which helps cover costs associated with injuries, property damage, and unforeseen events.
How much do daycare workers make?
In Canada, the average salary for a daycare worker, also called an early childhood educator, is about $34,127 per year, which is roughly $17.50 per hour.
How do I make a complaint about a daycare?
You should attempt to resolve the issue directly with the daycare provider. If that doesn't resolve the issue, you can file a complaint with the provincial department or body that regulates daycares. If you are making a formal complaint, be sure to include the name of the daycare, its address, a detailed description of the problem and who was involved, including dates and events.