Daycare business insurance averages $51 monthly, with costs ranging from $11 to $56 based on coverage and location.
Get matched with cheap daycare business insurance below.
Updated: October 13, 2025
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Daycare business insurance costs range from $138 to $678 annually on average, depending on your coverage type, state and sub-industry.
Your daycare insurance premiums depend on location, claims history and employee count when insurers calculate your rates.
Shop multiple business insurers, bundle policies, increase deductibles and pay annually to find affordable daycare business insurance costs.
We found average business insurance costs for daycare companies for commonly needed coverage are as follows:
| BOP | $49 | $583 |
| General Liability | $33 | $396 |
| Professional Liability (E&O) | $108 | $1,296 |
| Workers' Comp | $13 | $161 |
Note: We based these rates on small businesses with two employees across 79 major industries, focusing on four coverage types: general liability, professional liability/errors and omissions (E&O), workers' comp and business owner's policy. Your actual rates will vary based on your specific business factors and location.
Select your industry and state to get a customized quote.
Your daycare business insurance cost for general liability coverage depends on where you operate. Maine offers the best value at $29 monthly compared to the $33 national average, while New York costs $38 monthly.
| Alabama | $32 | $388 |
| Alaska | $30 | $354 |
| Arizona | $31 | $376 |
| Arkansas | $32 | $380 |
| California | $37 | $442 |
| Colorado | $33 | $393 |
| Connecticut | $36 | $431 |
| Delaware | $35 | $425 |
| Florida | $36 | $429 |
| Georgia | $34 | $403 |
| Hawaii | $34 | $414 |
| Idaho | $31 | $376 |
| Illinois | $36 | $435 |
| Indiana | $32 | $387 |
| Iowa | $31 | $377 |
| Kansas | $32 | $385 |
| Kentucky | $31 | $368 |
| Louisiana | $37 | $442 |
| Maine | $29 | $344 |
| Maryland | $32 | $378 |
| Massachusetts | $35 | $416 |
| Michigan | $31 | $376 |
| Minnesota | $31 | $372 |
| Mississippi | $33 | $399 |
| Missouri | $33 | $391 |
| Montana | $33 | $395 |
| Nebraska | $31 | $375 |
| Nevada | $37 | $450 |
| New Hampshire | $33 | $394 |
| New Jersey | $37 | $449 |
| New Mexico | $33 | $399 |
| New York | $38 | $461 |
| North Carolina | $29 | $344 |
| North Dakota | $29 | $345 |
| Ohio | $31 | $368 |
| Oklahoma | $31 | $368 |
| Oregon | $31 | $368 |
| Pennsylvania | $38 | $457 |
| Rhode Island | $36 | $435 |
| South Carolina | $34 | $408 |
| South Dakota | $31 | $371 |
| Tennessee | $32 | $387 |
| Texas | $33 | $400 |
| Utah | $31 | $377 |
| Vermont | $32 | $381 |
| Virginia | $30 | $361 |
| Washington | $38 | $451 |
| West Virginia | $35 | $416 |
| Wisconsin | $32 | $389 |
| Wyoming | $31 | $367 |
Note: We based these general liability rates on daycare businesses with two employees across different states. Your rates will vary based on your location, services you provide and claims history.
The cost of workers' compensation insurance for daycare businesses differs across states. North Carolina offers the most affordable rates at $11 monthly, while New York reaches $15 monthly. Our research shows that state regulations and claim histories drive these pricing variations.
| Alabama | $13 |
| Alaska | $12 |
| Arizona | $13 |
| Arkansas | $13 |
| California | $15 |
| Colorado | $13 |
| Connecticut | $15 |
| Delaware | $14 |
| Florida | $15 |
| Georgia | $14 |
| Hawaii | $14 |
| Idaho | $13 |
| Illinois | $15 |
| Indiana | $13 |
| Iowa | $13 |
| Kansas | $13 |
| Kentucky | $12 |
| Louisiana | $15 |
| Maine | $12 |
| Maryland | $13 |
| Massachusetts | $14 |
| Michigan | $13 |
| Minnesota | $13 |
| Mississippi | $13 |
| Missouri | $13 |
| Montana | $13 |
| Nebraska | $13 |
| Nevada | $15 |
| New Hampshire | $13 |
| New Jersey | $15 |
| New Mexico | $13 |
| New York | $16 |
| North Carolina | $11 |
| Oklahoma | $13 |
| Oregon | $12 |
| Pennsylvania | $15 |
| Rhode Island | $15 |
| South Carolina | $14 |
| South Dakota | $12 |
| Tennessee | $13 |
| Texas | $13 |
| Utah | $13 |
| Vermont | $13 |
| Virginia | $12 |
| West Virginia | $14 |
| Wisconsin | $13 |
Note: We based these workers' comp rates on daycare businesses with two employees across different states. Your workers' comp requirements and costs will vary by state since each has different regulations.
Your professional liability cost will vary by state. Nationwide, this coverage averages $108 monthly. North Dakota offers the most affordable rates at $92 monthly, while Pennsylvania has the highest costs at $125 monthly.
| Alabama | $107 |
| Alaska | $95 |
| Arizona | $102 |
| Arkansas | $104 |
| California | $120 |
| Colorado | $108 |
| Connecticut | $117 |
| Delaware | $116 |
| Florida | $117 |
| Georgia | $110 |
| Hawaii | $112 |
| Idaho | $101 |
| Illinois | $118 |
| Indiana | $106 |
| Iowa | $102 |
| Kansas | $106 |
| Kentucky | $101 |
| Louisiana | $120 |
| Maine | $94 |
| Maryland | $103 |
| Massachusetts | $115 |
| Michigan | $102 |
| Minnesota | $103 |
| Mississippi | $108 |
| Missouri | $107 |
| Montana | $108 |
| Nebraska | $103 |
| Nevada | $123 |
| New Hampshire | $105 |
| New Jersey | $122 |
| New Mexico | $110 |
| New York | $124 |
| North Carolina | $94 |
| North Dakota | $92 |
| Ohio | $100 |
| Oklahoma | $101 |
| Oregon | $100 |
| Pennsylvania | $125 |
| Rhode Island | $119 |
| South Carolina | $113 |
| South Dakota | $103 |
| Tennessee | $105 |
| Texas | $110 |
| Utah | $104 |
| Vermont | $105 |
| Virginia | $99 |
| Washington | $122 |
| West Virginia | $115 |
| Wisconsin | $106 |
| Wyoming | $99 |
Note: We based these professional liability rates on daycare businesses with two employees across different states. Your actual rates will depend on your services offered and location.
Daycare business insurance costs depend heavily on your state, with business owner's policy (BOP) premiums showing the biggest variation. BOP insurance cost ranges from $41 in Maine to $56 in Pennsylvania for the same coverage level.
| Alabama | $48 |
| Alaska | $44 |
| Arizona | $46 |
| Arkansas | $47 |
| California | $54 |
| Colorado | $49 |
| Connecticut | $52 |
| Delaware | $51 |
| Florida | $52 |
| Georgia | $49 |
| Hawaii | $51 |
| Idaho | $46 |
| Illinois | $53 |
| Indiana | $48 |
| Iowa | $45 |
| Kansas | $47 |
| Kentucky | $45 |
| Louisiana | $54 |
| Maine | $41 |
| Maryland | $46 |
| Massachusetts | $51 |
| Michigan | $45 |
| Minnesota | $45 |
| Mississippi | $49 |
| Missouri | $48 |
| Montana | $49 |
| Nebraska | $46 |
| Nevada | $56 |
| New Hampshire | $49 |
| New Jersey | $56 |
| New Mexico | $49 |
| New York | $56 |
| North Carolina | $43 |
| North Dakota | $42 |
| Ohio | $45 |
| Oklahoma | $45 |
| Oregon | $46 |
| Pennsylvania | $56 |
| Rhode Island | $53 |
| South Carolina | $50 |
| South Dakota | $45 |
| Tennessee | $47 |
| Texas | $50 |
| Utah | $46 |
| Vermont | $46 |
| Virginia | $45 |
| Washington | $56 |
| West Virginia | $50 |
| Wisconsin | $48 |
| Wyoming | $46 |
Note: We based these BOP rates on daycare businesses with two employees across different states. Your actual rates will vary based on your business size, location, and coverage needs.
Daycare business insurance costs vary by provider, ranging from $43 to $60 monthly. These price differences reflect each insurer's market focus and risk assessment strategies, which shift based on profitability and coverage expansion opportunities.
| Chubb | $60 | $719 |
| Coverdash | $53 | $636 |
| Hiscox | $54 | $643 |
| NEXT Insurance | $45 | $545 |
| Nationwide | $57 | $684 |
| Progressive Commercial | $50 | $606 |
| Simply Business | $51 | $611 |
| The Hartford | $43 | $521 |
| Thimble | $53 | $640 |
| biBERK | $49 | $586 |
Several factors affect your daycare business insurance costs when insurers calculate your policy rates:
Your facility's location substantially impacts insurance pricing through regulatory environments and claim patterns. States with stringent licensing requirements and frequent child care lawsuits command higher premiums than those with more relaxed oversight. Urban centers with higher litigation rates cost more to insure than rural communities with fewer claims.
Previous incidents involving children affect your insurability and rates dramatically. Injury claims, abuse allegations, or licensing violations remain on your record for extended periods, making coverage expensive or difficult to obtain. Daycares maintaining spotless safety records with documented staff training and zero incidents receive preferred pricing from carriers.
Staff size directly determines workers' compensation and employment liability costs. Home daycares with one or two providers maintain minimal insurance expenses, while centers employing teachers, aides, and administrative staff see premiums scale with payroll. Child care workers face back injuries from lifting children and exposure to communicable diseases, elevating workers' comp classifications.
Programs beyond basic supervision introduce additional exposures. Transportation services require commercial auto coverage for vans and field trips. Offering meals involves food preparation liability and allergy management concerns.
Extended hours, overnight care, or specialized programs for special needs children each carry distinct risks requiring tailored coverage.
Enrollment capacity and income indicate your operational scale and coverage needs. Small home daycares serving six children with $60,000 annual revenue need modest protection.
Large centers accommodating 100+ children with $800,000 in billings require comprehensive policies. Higher enrollment means more potential incidents and greater liability exposure.
Protection amounts you select create major premium variations. Most daycares carry $1-2 million in general liability, though many states and licensing bodies mandate minimum coverage levels. Sexual abuse and molestation coverage, requiring separate policies, adds substantial costs given the catastrophic nature of such claims in child care settings.
Your property characteristics influence both liability and property coverage costs. Outdoor playgrounds with climbing structures, swimming pools, or water play areas increase accident potential and premiums accordingly.
Financial standing influences a carrier's willingness to offer competitive rates. Daycare owners with strong credit profiles often receive 12% to 32% discounts compared to those with credit difficulties.
Solid financials demonstrate operational stability in an industry where many small providers struggle with thin margins and irregular cash flow.
Cutting daycare business insurance costs takes careful planning and informed choices. Our step-by-step guide walks you through how to find cheap business insurance for your daycare while strengthening your risk profile and protecting your operation long-term.
Daycare centers require general liability for child injuries, sexual abuse and molestation coverage (often mandatory for licensing), professional liability for supervision claims and property insurance for your facility and playground equipment.
Workers' compensation protects your staff, while commercial auto covers field trips and transportation services. Most states mandate minimum liability limits of $1 million to $2 million per occurrence, so verify your local requirements before purchasing.
Daycare insurance costs vary dramatically based on enrollment capacity, staff-to-child ratios, and whether you care for infants versus school-age children only. Specialized childcare insurers offer better rates and coverage terms than general business carriers since they understand your unique exposures.
Shop at least three providers and verify each policy includes abuse coverage, as some exclude it or charge substantial additional premiums.
A business owner's policy combining general liability, property, and business interruption costs 20% to 30% less than separate policies. Adding professional liability and abuse coverage to your bundle often provides additional multi-policy discounts.
Consolidated coverage also means one renewal date and simplified paperwork when licensing boards request proof of insurance each year.
Higher property deductibles of $2,500 to $5,000 can reduce premiums, especially for established centers with strong safety records. Keep general liability deductibles low since injury claims involving children can arise even with excellent supervision and safety protocols.
Monthly payment plans for daycare insurance include 5% to 10% in financing charges that strain already tight margins. Annual payment eliminates these fees entirely, and many insurers provide an additional 6% to 8% discount for paying upfront.
Review your insurance annually or whenever you increase licensed capacity, add classrooms, or expand age groups served. Property limits should increase when you invest in new playground structures, kitchen equipment or facility renovations.
Daycare business insurance costs between $11 and $56 per month, but your exact premium will depend on factors like location, business size, and claims history. You can often lower your rates by comparing quotes from several insurers, bundling policies, choosing higher deductibles, and paying annually instead of monthly.
Daycare business owners commonly ask about insurance costs. We answered the most frequent questions below:
General liability coverage is the most affordable at $33 monthly, but workers' compensation ($13 monthly) covers only employee injuries. Most daycare businesses require general liability protection since it shields them from client incidents and property damage lawsuits.
You'll pay more in these states. General liability in California runs $37 monthly (vs. $33 national average), and BOP costs $54 monthly (vs. $49 average). New York is similar at $38 and $56, respectively.
Bundling daycare business insurance policies delivers greater savings compared to purchasing individual coverage. Insurance companies provide discounts when you package general liability, commercial property and commercial auto coverage together.
Multiple factors increase premiums: previous liability claims, larger enrollment capacity, inadequate safety protocols, high staff turnover, urban locations with elevated risks and insufficient background screening procedures.
Higher deductibles reduce monthly premiums, though you'll face larger out-of-pocket costs during claims. Your decision should depend on available cash flow and claim frequency expectations.
Workers' compensation costs for daycare businesses vary by state, spanning from $11 monthly in North Carolina to $16 monthly in New York.
Yes, BOP insurance is worth it for daycare companies. BOP costs $49 monthly and bundles general liability, commercial property and business interruption coverage together, saving money versus purchasing policies separately.
Shop annually when your policy renews. Comparing quotes from multiple insurers can uncover savings, especially after expanding your staff or adding new daycare services.
We collected daycare business insurance quotes from companies across different states. For consistent comparisons, every quote used the same business setup:
We used a typical small daycare business profile requiring comprehensive coverage. We chose companies offering broad national coverage and online quote capabilities, prioritizing insurers that serve the daycare industry.
About Mark Fitzpatrick
Mark Fitzpatrick, a Licensed Property and Casualty Insurance Producer, is MoneyGeek's resident Personal Finance Expert. With over five years of experience analyzing the insurance market, he conducts original research and creates tailored content for all types of buyers. His insights have been featured in publications like CNBC, NBC News and Mashable.
Fitzpatrick holds a master’s degree in economics and international relations from Johns Hopkins University and a bachelor’s degree from Boston College. He's also a five-time Jeopardy champion!
He writes about economics and insurance, breaking down complex topics so people know what they're buying.
