Nanny insurance refers to policies for individuals who care for children in a residential setting and protects their assets by covering risks common to the profession. These risks all fall under general and professional liability, two of the most common policies.
Nanny insurance can also refer to the policies a household should purchase for a domestic worker, such as workers’ compensation and employment liability insurance. General liability insurance for babysitters typically costs between $300 and $1,400 annually. Meanwhile, professional liability averages $1,000 annually.
Tivly is the leading digital marketplace for small businesses trying to find insurance. Request contact or call directly for assistance in finding nanny insurance. One of its representatives will work with you to find the right carrier for your specific needs and help you get a quote.
Nanny Insurance Costs
We received several quotes from different providers to estimate the annual premium a nanny may pay. For each quote, the total income was less than $100,000 annually, and the nanny had no claims in the last three years.
Estimated Annual Premium | Limits | |
|---|---|---|
Professional Liability | $900-$1,100 | $25,000 per occurrence/$50,000 aggregate |
Abuse & Molestation | Usually available as an endorsement | $25,000 per occurrence/$50,000 aggregate |
General Liability | $300-$1,400 | $1 million per occurrence/$2 million aggregate |
Surety Bonds | $1,000-$5,000 | $100,000 total |
Risk management is vital when caring for children. While risk-mitigating actions such as those listed below may not reduce the actual premium cost, they can help reduce loss frequency and have a long-term impact on managing your premium.
- Written contracts: When a family hires you to watch their children, ensure a written contract is in place that explains the scope of your responsibilities.
- First aid: Consider taking first aid training so you can provide immediate care and reduce the severity of injuries for those in your charge.
For tips on finding quality yet affordable coverage, read our article on the ways to save money on business insurance.
Who Needs Nanny Insurance?
Nannies and parents employing nannies may need nanny insurance. But the coverage each group needs depends on each nanny’s classification (i.e., whether they’re a contractor or an employee).
Nannies
If a family hires you as a contract employee, consider the policies we discuss in our coverage section below to see which one is right for you. Check whether you meet the IRS standards for self-employment to determine if insurance is the right course to take.
You usually do not need first-party coverage because your work is performed at someone else’s home. The primary policy you will need is liability insurance.
Since no government agency regulates nannies, no government agency can issue a nanny license and require you to have insurance. Some private organizations offer certifications, but even in those cases, most do not have insurance programs.
Parents Employing Nannies
Parents also need to think about insurance. When interviewing a nanny, discuss insurance expectations. Not only should you find out if the candidate already carries insurance, but you also need to establish what coverage you wish to, or in some cases are required to, provide.
For example, depending on the state, you may be required to provide workers’ compensation insurance for the nanny. In Massachusetts, a family must purchase workers’ comp if the nanny regularly works at least 16 hours per week. Additionally, if you allow the nanny to drive your vehicle regularly, you need to consider adding them to your personal auto policy.
Depending on your income level, some carriers offer specialized homeowners insurance that includes coverage for domestic servants, which nannies might fall under. This is an alternative solution for parents needing insurance for an au pair.
When discussing nanny insurance, we refer to a contracted worker who is taking care of children for a family on a long-term basis. This is not the same as an occasional babysitter.
If you babysit for the neighbors, you likely don’t need any babysitting insurance. However, liability coverage is recommended for any size business that professionally offers babysitting or nanny services, whether you are a sole proprietor or have an LLC with employees.
While both nannies and daycare workers care for children, the two are very different.
- Nannies work in a family’s home and function like independent contractors or, in some cases, employees of the family.
- Daycare workers work at a facility where children get dropped off, and daycare centers typically watch many children from multiple families.
Daycare is a business operation with different risks and insurance needs. State agencies license and monitor it for compliance. Because of its size and scope, daycare insurance costs and coverage are more complex and have higher limits than nanny insurance.
Nanny Insurance Coverage
If you work full-time or part-time for a family as a nanny, you should seriously consider several policies, including professional liability. If you work for a nanny service, check with your employer first to see what type of policy they have purchased and if it covers you.
Professional Liability
For nannies, professional liability is probably the most important coverage to consider. While professional liability is narrower than general liability in what it covers, its coverage is especially relevant for nannies because it is designed for those who work in the services sector. Professional liability covers mistakes, oversights, breaches of contract, and undelivered services.
If you feed the child you are watching lunch, fail to read ingredient labels, and accidentally feed them something they are allergic to, the parents could hold you responsible if the child becomes sick. This is a scenario where professional liability could be utilized.
Abuse & Molestation
Since nannies work with children, usually in a setting without any other adults present, abuse and molestation coverage is an unfortunate but necessary policy to consider. This coverage is sometimes included with general liability or professional liability. It can also be purchased as a standalone policy.
It helps with the financial costs of investigating and defending allegations of abuse and molestation against your business or employee. The limits for this coverage are usually lower.
Optional Nanny Insurance Coverage
If you will be working full-time with a family, consider taking a proactive approach by discussing insurance expectations with the parents. For example, if you accidentally break an expensive vase or spill juice on a costly carpet, will the family cover the damages, or will they expect you to pay for it?
If the parents expect you to pay for those types of losses, then you should look into getting general liability insurance. This policy protects you from claims of bodily injury and third-party damage. It covers incidents where you accidentally injure a child or damage property in the home. Check with your provider to see if corporal punishment, abuse, and molestation liability are included or available as endorsements.
As a nanny, a surety bond is another option to cover certain claims. It isn’t an insurance policy but rather a financial guarantee for the family—the bond provider agrees to pay claims the family makes against you. A surety bond provides narrower coverage than a liability policy because it is tied to specific events.
Typically, surety bonds will cover claims that you:
- Stole from the family
- Caused damages to their property
- Failed to provide contracted services
Surety bonds might be a more affordable option because the premium is typically 1% to 2% of the total bond.
This coverage is primarily important if you own a professional nanny service. If your company has employees who are staffed in homes and regularly transport children as part of their job, it is a risk to assume a client’s personal auto policy will cover the loss. The nanny service should consider a fleet policy or hired and nonowned auto coverage (available through general liability).
If you are an independent contractor and regularly transport children for your job, reach out to your agent to discuss coverage. Personal auto policies almost universally have a livery exclusion in the policy. If this is the case, you’ll need to either purchase a commercial auto policy or a livery endorsement.
Nanny Insurance Policies for Employers
Many states see you as an employer if you hire a part-time or full-time nanny. As surprising as it may seem, the pay threshold for some states is incredibly low. For example, in Ohio, if you pay a domestic worker at least $160 in any calendar quarter, they are considered an employee, and you are required to provide them with workers’ compensation.
Workers’ Compensation
If an employee is injured or becomes ill because of their job, workers’ compensation insurance helps cover related medical bills and wage loss. Workers’ comp providers also offer return-to-work programs to minimize downtime, and the policies in most states have liability protection for the employer.
Nanny Insurance Workers’ Compensation Requirements by State
We’ve researched nanny insurance requirements, so you don’t have to. See if you are required to provide workers’ compensation insurance for your nanny.
Babysitting & Nanny Insurance: Cost, Coverage & Companies
Employment Practices Liability Insurance
When you let someone into your home for an extended period of time, sometimes the situation can become unintentionally and uncomfortably familiar. When this happens, as the employer, you could open yourself up to claims that fall under the protection of employment practices liability insurance (EPLI). EPLI helps a business when it is accused of things like sexual harassment, gender discrimination, or wrongful employment.
How to Get Nanny Insurance
Child care liability insurance is a specialized type of insurance, and in our research, it isn’t always the easiest to find. You have two options for finding and purchasing nanny insurance.
Option 1: Through a Broker
A broker is a licensed professional who can sell insurance from multiple carriers. One advantage of working with a broker is that they can help you find coverage from the right provider, often by offering you a price comparison.
For a nanny who may need a few different types of coverage, like professional liability and commercial auto, the broker may be able to find a great deal on professional liability from one provider and an affordable commercial auto policy from another.
Our guide on how to compare small business insurance quotes offers useful tips to get you started.
Option 2: Through a Carrier
You can purchase insurance through a carrier either directly or by working with a local agent. Many agents work directly for the carrier, but others are independent and, similar to a broker, will work with multiple carriers. The advantage of working directly with a carrier is that sometimes the cost will be lower if you go directly with the provider instead of through a broker.
If you are trying to get a quote online for nanny or babysitting insurance, make sure to enter “child care,” “nanny,” or “in-home child care” when asked for the industry—use whichever term best fits your line of work. Most companies don’t classify “babysitting” as a specific industry.
If you’d like to learn more about the differences between the two, see our comparison of insurance broker vs carrier.
Best Nanny Insurance Companies
When researching companies that provide dedicated insurance for nannies or babysitters, the list narrows significantly. That said, there are still a lot of options out there, and after evaluating the available companies by looking at their availability by state, the type of insurance offered, their customer services, and the convenience for the customer, we were able to find the five best providers for nanny insurance.
- Tivly: Best overall for finding nanny insurance
- Next Insurance: Best for fast and affordable coverage
- Simply Business: Best for workers’ compensation
- Nationwide: Best for homeowners hiring an au pair
- biBERK: Best for nannies who are also housekeepers
Tivly: Best Way to Find Nanny Insurance
Pros
- Initiate a quote or call to start
- Quick turnaround on call requests
- Key policies needed are available
Cons
- Since it is a marketplace, Tivly doesn’t handle claims
- Account maintenance, services, and costs depend on the provider
Standout Features:
- Connects you with the provider best for your nanny business for free
- Has connections with over 200 different carriers, brokers, and MGAs, making it a great option for finding nanny insurance
- Lets you start a quote online by providing a few contact details or by calling Tivly directly; within minutes, you can speak with a representative about your specific insurance needs
Financial Stability: Tivly works with multiple carriers that are AM Best top-rated, like Liberty Mutual (A Excellent) and The Hartford (A+ Superior).
Next Insurance: Best for Fast & Affordable Coverage
Pros
- Get a quote in 10 minutes or less
- Same-day coverage available
- Agents available to help guide you
Cons
- Only available Monday-Friday, 8 a.m.-5 p.m. CT
- Not all coverage is available everywhere
Standout Features:
- Coverage for in-home and out-of-home care providers
- iOS and Android apps let you manage your claims and policy and create COIs
- General liability and professional liability offered as a combined policy
- Affordable: our quote was for $48.42 per month for professional and general liability policies
Financial Stability: Next Insurance was founded in 2015. Next Insurance’s AM Best rating is A- (Excellent).
Simply Business: Best for Workers’ Compensation
Pros
- Compare quotes online
- Works with multiple top-rated providers
- Purchase insurance online
Cons
- No 24/7 call center
- No mobile app for business customers
- Limited information on support and return-to-work services
Standout Features:
- Get a quote online for workers’ comp and compare quotes from top providers
- Purchase a policy online without speaking to anyone, or talk to a dedicated agent
- Very positive customer reviews
- Offers sole proprietor workers’ comp for nannies
Financial Stability: Simply Business works with multiple top-rated carriers like Hiscox (A Excellent) and Travelers (A++ Superior).
Nationwide: Best for Homeowners Hiring an Au Pair
Pros
- 24/7 claims and customer services available
- Homeowner or auto available
- Online account maintenance
Cons
- Target is for high-value homeowners, but there are no further details on who qualifies
- Quotes are available only through the local agent
Standout Features:
- Offers Nationwide Private Client, a special homeowner’s policy for individuals with a high net worth, assets, or high-value home; the coverage includes liability for domestic employees
- Includes much higher limits than typical homeowners, like $50,000 for damage to things like crystal or wine collection
- Provides an ideal type of policy for a homeowner who has hired an au pair who lives on premises or is present regularly to take care of the children
Financial Stability: Nationwide has nearly 100 years of experience in insurance and a strong rating of A+ (Superior).
biBERK: Best for Nannies Who Are Also Housekeepers
Pros
- Purchase insurance online
- In-house claims department
- Core policies available
Cons
- Coverages vary by state
- Does not offer EPLI
- Does not maintain a 24/7 call center
Standout Features:
- Helps save up to 20% by selling insurance directly to consumers
- Online account portal to manage your policy, file a claim, or obtain proof of insurance
- Great for self-employed nannies who also clean due to specific endorsements for maid services
- High customer satisfaction: 4.9 out of 5 stars from over 40,000 reviews by customers
Financial Stability: biBERK is owned by Berkshire Hathaway. AM Best rated Berkshire Hathaway A++ (Superior).
Frequently Asked Questions (FAQs)
A general liability policy can range from $300 to $1,400 annually, whereas professional liability insurance may run from $900 to $1,100 annually. Insurance companies consider many factors when calculating a premium, including years of experience and claims history.
Depending on the state, workers’ compensation may be required for a nanny. For example, in Massachusetts, a nanny who works for a family for 16 hours a week should be covered by workers’ comp. While the threshold may change for a domestic worker in a family business, the state may still mandate workers’ comp, so you will want to check with your specific administrative office.
The answer depends largely on the frequency of use and the language of your policy. Many policies will have an exclusion for frequent and regular use of the vehicle by a nonlisted driver. If the babysitter drives your car multiple times a week, for weeks on end, and gets into an accident, it could become a coverage issue for your carrier.
Review your policy and the situation with your agent, and if there is a concern that coverage doesn’t apply, then you’ll want to look into a commercial auto policy.
Traditional homeowner policies carry liability and medical payment coverage. However, the limits are usually capped at $300,000 for liability and run from $1,000 to $5,000 for medical payments. Assuming there is no exclusion in the policy for the situation, the limits may not be enough. The best thing to do is review your policy with your agent.
Bottom Line
Trust is central to a successful relationship between a nanny and their employer. It’s essential that families can trust nannies to do the right thing and have the financial resources if something goes wrong.
Nanny insurance protects nannies and their assets if a child becomes injured or their employer’s property is damaged due to their service. After you provide a few points of information, a representative from Tivly can help you find the right nanny insurance.
