A business owners policy, usually called a BOP, is a package policy for smaller businesses. Instead of buying general liability and property insurance separately, a BOP combines them under one policy with one renewal date. Some childcare businesses use a business owners policy for daycares as the base of their insurance program. Coverage varies by insurer and policy, and not every daycare qualifies.
What a business owners policy usually combines
Most BOPs are built around the same core pieces. Coverage may include:
- General liability. Third party bodily injury and property damage, such as a parent who slips on the front walk at pickup. Our general liability page covers this in detail.
- Commercial property. Your building if you own it, plus classroom furniture, cribs, cots, toys, kitchen equipment, and office computers. See commercial property insurance.
- Business income. Lost income and continuing expenses, such as payroll and rent, if a covered property loss forces you to close for a while.
- Optional add ons. Many BOPs allow endorsements for items like equipment breakdown, outdoor property, or higher limits on specific property.
How business income fits into a BOP
Business income is one of the main reasons owners like the package approach. Many BOPs include some amount of business income and extra expense coverage automatically, tied to a covered property loss. If a kitchen fire closes your classrooms for several weeks, that coverage can help keep teachers on payroll and pay rent while repairs happen.
The details matter. Some BOPs include business income for a set period of time, others use a dollar limit, and waiting periods differ. Our page on business income insurance explains the terms to check, including waiting periods and extra expense.
Why a BOP may be useful for a childcare business
For an eligible daycare, a BOP can make insurance easier to manage. One policy, one bill, and one renewal means fewer documents to track when your landlord asks for a certificate or your licensing file needs updating. A package may also be priced efficiently compared with buying each piece on its own, although that depends on the insurer and your operation.
A BOP can also reduce the chance of a gap between your liability and property coverage, since both are written together. That simplicity is useful, as long as the package actually fits how your program operates.
Why a BOP is not automatically enough for a daycare
Many business owners policies are designed for offices, shops, and service businesses. A childcare program has a different exposure: young children, all day supervision, naps, meals, playgrounds, and sometimes transportation. Before relying on a BOP, check these areas closely:
- Abuse and molestation exclusions. Many BOP liability forms exclude these allegations entirely.
- Treatment of enrolled children. Some forms limit or exclude injuries to the children in your care, which is the exposure you most need covered.
- Professional services exclusions. Claims about improper care, supervision, or medication may fall outside a BOP's liability coverage.
- Limits. Liability and property limits need to meet your lease, contracts, and licensing documents, and fit the value of what you own.
- Eligibility. Insurers set their own rules for which childcare operations they will write under a BOP. Eligibility depends on underwriting.
Coverages usually written separately or added
Even a well built BOP leaves out several coverages a childcare business commonly needs. These are typically added by endorsement or written as their own policies:
- Workers compensation. Employee injuries are not part of a BOP. See workers compensation.
- Commercial auto. A center van, field trip driving, or school pickups need commercial auto insurance.
- Abuse and molestation. Often added by endorsement or as a separate policy. See abuse and molestation coverage.
- Professional liability. Claims that the care itself fell short. See professional liability insurance.
- Cyber. Parent portals, enrollment software, and payment records create a cyber insurance exposure.
- Umbrella. An umbrella policy can add liability limits above the BOP, auto, and employer's liability.
- Employment practices liability (EPLI). Claims from staff or applicants alleging discrimination, harassment, or wrongful termination. Some BOPs offer a limited endorsement; others require a separate policy.
Which childcare businesses a BOP may fit
BOPs tend to be considered for smaller operations with straightforward exposures. That may include smaller childcare centers, private preschools, and some school age programs, especially those in a single location without transportation. Larger commercial daycare centers, programs with infant care, or operations with vans and multiple sites are often placed in a childcare package designed for the industry instead.
Some insurers do not offer BOPs to childcare risks at all. Others will, with specific endorsements or restrictions. Eligibility depends on underwriting, so the right structure for your program may be a BOP, a childcare package, or separate policies.
Family childcare is usually handled differently. If you care for children in your own home, see in-home daycare insurance for the options that typically apply.
Questions to ask when comparing a BOP
Whether you are reviewing a renewal or comparing quotes, these questions help you see what a BOP really includes:
- Does the liability coverage apply to injuries to enrolled children?
- Is abuse and molestation excluded, and if so, how will it be added and at what limit?
- Is there a professional services exclusion, and how are supervision and care claims handled?
- How is business income written: a time period or a dollar limit, and what is the waiting period?
- Are playground equipment, fences, and outdoor property covered, and at what value?
- Do the liability limits meet your lease, contract, and licensing requirements?
- Which coverages will you still need to buy separately, such as workers compensation or commercial auto?
- Are any activities you offer, like swimming or field trips, excluded or restricted?
Getting a quote for your childcare business
As part of Nelson Insurance Agency, an independent agency, we can look at options from more than one insurer, including BOPs where they fit and childcare packages where they do not. Our guide to daycare insurance cost explains what affects pricing. When you are ready, request a quote and a childcare insurance specialist will review coverage options for your operation.