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Indiana licenses daycares without demanding liability insurance — the one policy its rules do name is on the van. The center licensing rules (470 IAC 3-4.7) require insurance on vehicles used to transport children, and nothing on general liability. What Indiana lacks in a coverage mandate it makes up in employment law: workers’ comp is required from the first employee’s first day, with penalties that accrue daily.
One policy, priced for a Indiana daycare
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What Indiana Actually Requires
| Coverage | Indiana requirement |
|---|---|
| General liability | Not required by the licensing rules — licensed ≠ insured in Indiana |
| Vehicle insurance | Required on any center-owned or leased vehicle used to transport children (470 IAC 3-4.7) |
| Workers’ compensation | Required from the first employee, from day one — penalties up to $10,000 per violation plus $50 per uncovered employee per day |
Licensed Is Not Insured Here
An Indiana daycare licence certifies ratios, training, drills and square footage — it never asks whether a slip on the playground is covered. That gap belongs to the operator, and the parties who actually enforce coverage in Indiana are the landlord, the CCDF subsidy paperwork, and the parents comparing enrollment packets. A “fully licensed” center with no liability policy is legal and one incident from closure.
The state’s firm line is employment: coverage in force when the first teacher’s first shift begins, owners excluded by default but able to elect in, and a penalty meter — $50 per uncovered employee per day — that makes drift expensive fast.
The Coverages Every Daycare Carries Regardless
- General liability with abuse & molestation coverage. The playground injury and the allegation are different claims; a daycare policy without A&M cover is missing the exposure the business is actually judged on.
- Commercial auto if you transport children — a personal policy excludes business use.
- Workers’ compensation once you employ staff (required in Indiana from the first employee’s first day).
- Property and contents for the build-out, equipment and food stock.
Parents ask if you’re insured. So do licensors.
A certificate of insurance answers both in one page. Quotes are free and don’t require a phone call.
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Frequently Asked Questions
Is liability insurance required for an Indiana daycare?
No — Indiana’s center licensing rules (470 IAC 3-4.7) require insurance only on vehicles used to transport children, not general liability coverage. Landlords, CCDF subsidy requirements and parent expectations are what make liability coverage a practical necessity.
When does an Indiana daycare need workers’ comp?
From the first employee’s first day of work — Indiana has no minimum-employee threshold, and penalties run up to $10,000 per violation plus $50 per uncovered employee per day.
Comparing states? See daycare insurance requirements in every state, or the full guide to starting a daycare in Indiana.
Sources
| Source | What it confirms |
|---|---|
| Indiana FSSA — child care laws and rules | 470 IAC 3-4.7 licensing standards; vehicle insurance; no GL mandate |
| Indiana Workers’ Compensation Board | First-day WC rule and penalties |
