Babysitting & Nanny Insurance: Cost, Coverage & Providers
Nathan Weller is an Insurance Expert focusing on insurance for small business. He has 15 years experience in insurance operations, FNOL, and claims handling.
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 liability, and general and professional liability are two of the most common policies. General liability insurance for babysitters typically costs anywhere from $300 to $1,400 annually and professional liability averages $900 annually.
Working with children in other people’s homes is risky, so it can be hard to find insurance for a nanny. Fortunately, CoverWallet can help you. Get quick quotes from multiple carriers today.
Who Needs Nanny Insurance?
Two different categories of people should consider nanny insurance. The types of insurance to consider differ based on the category.
If you’re a nanny, consider the policies we discuss below to see which one is right for you. Check if you meet the IRS standards for self-employment to determine if insurance is the right course to take. You usually don’t need first-party coverage because your work is done in someone else’s home. Since no government agency regulates nannies, no government agency can issue a nanny license and require you to have insurance. Some private organizations offer you certification, but even in those cases, most don’t have insurance programs.
Parents also need to think about insurance. When interviewing a nanny, discuss insurance expectations. Not only should you find out if they’re carrying 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 for the nanny. In Massachusetts, a family must purchase workers’ comp if the nanny regularly works at least 16 hours per week. If you allow the nanny to drive your vehicle regularly, you need to consider adding her to your personal auto policy.
Nanny Insurance Policies Costs by Policy
Coverage | Coverage Limits | Estimated Annual Premium |
|---|---|---|
General Liability | $1 million/$2 million | $300 to $1,400 |
Abuse & Molestation | $25,000/$50,000 | Check to see if it is included |
Professional Liability | $25,000/$50,000 | $900 to $1,100 |
Surety Bonds | $100,000 | $1,000 to $5,000 |
When caring for children, risk management is of utmost importance. While actions such as the following may not reduce the actual premium cost, they can help reduce loss frequency and so have a long-term impact on managing your premium.
- Written contracts: When a family hires you to watch their children, make sure there’s a written contract explaining the scope of your responsibilities.
- First aid: Preventing injuries and providing immediate care, when necessary, can stop problems and reduce the severity of injuries.
Babysitting Insurance Coverage
Nanny or babysitting insurance is a combination of policies that protect you from negligence claims.
General Liability
The primary policy you need is general liability, which protects you from claims of bodily injury and third-party damage. This is coverage for 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.
Professional Liability
You’ll also want to consider professional liability insurance, which covers three categories: negligence, copyright infringement, and personal injury. As a nanny, the relevant category is negligence.
If the child you’re watching becomes sick after eating some food that contains an ingredient that they’re allergic to, the parents could hold you responsible. This is a scenario where professional liability could be utilized. Because neither professional liability nor general liability covers everything, having both is a good idea.
Another example: If you drive the children you watch to the park or school, the activity is typically covered under your personal auto policy because it isn’t your primary job to drive them. However, you should review the specific exclusions with your agent to determine if you need a separate commercial auto policy.
Surety Bond
As a nanny, a surety bond is another option. It isn’t a type of insurance policy but a financial guarantee for the family. The bond provider agrees to pay claims the family makes against you. Typically, three categories fall under the surety bond if you:
- Steal from the family.
- Cause damages to their property.
- Fail to provide contracted services.
Surety bonds provide narrower coverage than a liability policy because they’re tied to specific events.
Best Nanny Insurance Providers
There are few providers with dedicated information for nanny insurance. The following list contains either a broker that can provide quotes for nanny insurance or carriers with excellent customer service and general liability available for independent contractors.
- CoverWallet: Best for fast estimates from multiple carriers
- Next Insurance: Best for cheap premiums
- The Hartford: Best for independent contractors
- Au Pair: Best for families who host an au pair
- biBERK: Best for nannies who also clean homes
CoverWallet: Best for Fast Estimates
CoverWallet is the best overall provider for nanny insurance because as a broker, it can find multiple carriers and quickly provide quotes for you to compare. This is essential because it can be hard to find coverage for this niche profession.
Cost & Coverage
After answering some questions about our business, we received three quotes for general liability. The lowest-priced one was for $313 monthly, and this policy was for $1 million per occurrence and $2 million aggregate limits and included blanket insureds.
Customer Satisfaction & Convenience
Beyond the quick quoting process, CoverWallet creates an online account for you to manage your policy and make changes, including requesting a certificate of insurance (COI). As your nanny career evolves, it has insurance advisors who can work with you to ensure you have the coverage you need.
Financial Stability
CoverWallet is owned by Aon. Aon has a credit rating of A Excellent from AM Best.
Next Insurance: Best for Cheap Premiums
Next Insurance provides child care insurance for in-home and out-of-home care providers. You can quickly get a quote and purchase a policy online. Typically, its liability premiums are very affordable.
Cost & Coverage
We received a quote for a general liability policy that included Errors & Omissions for $48.42 per month, with $96.80 due on the first and last month of the period. The limits on the policy were $1 million per occurrence with a $3 million aggregate and $1 million per limit and aggregate for the professional liability coverage.
Customer Satisfaction & Convenience
Next Insurance is a new insurtech company that has put the digital experience at the front of what it does. You can get a quote, purchase and manage a policy, and file a claim online.
It also has an app for commercial lines that functions like a 24/7 call center. The hours of operation are Monday to Friday, 8 a.m. to 5 p.m. Central time.
Financial Stability
Next Insurance, founded in 2015, has a rating of A- Excellent by AM Best.
The Hartford: Best for Independent Contractors
The Hartford offers excellent customer service and convenient policy management and is the best provider for nannies who work as independent contractors. It has hundreds of years of experience in insurance and provides general liability, independent contractor liability, and professional liability policies.
Cost & Coverage
We received a quote for a general liability policy for $107 monthly. If you pay the premium in full, it’s eligible for a discount. The quote was for a standard general liability policy with limits of $1 million per occurrence and $2 million aggregate.
Customer Satisfaction & Convenience
Getting a quote, purchasing a policy, and managing it are all done online easily. If you have a problem, The Hartford has 24/7 service available to assist you, and if a claim is filed, its in-house claims team will walk you through the process.
Financial Stability
With more than 200 years of experience, The Hartford has the stability you can trust. It has an A+ Superior rating from AM Best.
Au Pair in America: Best for Families Who Host an Au Pair
Au Pair in America is an association that helps families connect with au pairs. It has a plan that provides health insurance and professional liability.
Cost & Coverage
The insurance provided is included in the overall prices of its program. As stated, the plan is health insurance and professional liability. The professional liability has a limit of $100,000.
Customer Satisfaction & Convenience
The organization doesn’t provide any information on which insurance company underwrites the policy. It also doesn’t include information on claim filing or customer service. However, there’s a 24/7 emergency hotline listed on its website.
Financial Stability
Since there’s no information on which insurance company underwrites the policy, we cannot provide a financial rating for this policy.
biBERK: Best for Nannies Who Also Clean Homes
Cost & Coverage
We received a quote from biBERK for $1,304 annually. This is for a general liability policy with standard limits of $1 million per occurrence and $2 million aggregate. It also includes $3,000 in coverage for any cleaning equipment you may own.
Customer Satisfaction & Convenience
After receiving a quote from biBERK, you can set up an account that will let you manage your policy, request documents, and pay your premium. If you need to file a claim, you can do that online or via phone. You can request a certificate of liability through its website.
Financial Stability
biBERK is owned by Berkshire Hathaway, with a rating of A++ Superior by AM Best.
Daycare vs Nanny Insurance
While both nannies and daycare workers care for children, the two are very different. Nannies work in a family’s home and function like an independent contractor or, in some cases, an employee of the family. Meanwhile, daycare workers work at a facility where children get dropped off, and daycare centers typically watch many children from multiple families.
The daycare is a business operation with different risks and insurance needs. Daycares are licensed and monitored for compliance by state agencies. Because of the size and scope, daycares need more complex insurance with higher limits than a nanny.
Bottom Line
Trust is central to a successful relationship between a nanny and their employer. It’s essential that the families they work for know they can trust them not just to do the right thing, but to 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.
As an online broker, CoverWallet can help get quick quotes from multiple carriers to find the right coverage at the right price. Get a no-obligation quote today.
