Insurance implications when expanding your nursery

Increasing the number of places at your nursery?

If you intend to increase the number of places available at your nursery, and if local demand warrants it, you'll need to consider the suitability of existing facilities and your ability to comply with regulatory requirements. These measures are designed to ensure the health and safety of the children in your care so, for example, you'll need to work out if you have enough space for each child. Do you have enough toilets and hand basins with hot and cold water? Are staff/child ratios being maintained?

It's likely you were asked to declare the number of children you look after along with a turnover and/or wage roll figure when you originally took out your policy. Wordings vary but many policies stipulate that increases to child numbers, fluctuations in turnover and increases in the sums insured should be declared to your insurer. If you are underinsured it's possible your insurer will only pay part of any claim you make and, in some circumstances, they may decline cover altogether. If you are in any doubt, your broker can advise you.

Thinking about buying another nursery?

If you plan to expand your business through the acquisition of an existing nursery it's worth checking some basic historical information before proceeding:

• Does the nursery have a good reputation within the community? How do other nurseries in the area compare?

• Ask to see the existing insurance information including details of cover, premium levels and claims experience; a history of floods or subsidence could affect your premium and/or ability to buy cover at all.

• Ensure the premises are safe and secure and furniture and equipment is well maintained and conforms to safety regulation standards. A risk assessment should be carried out and documented to ensure all play equipment is in a good general state.

• If you're considering taking on existing staff, check they have the relevant qualifications for the role, that health and safety training has been provided and child safety procedures are robust and well documented.

• Speak to parents to find out what the existing owners do well and identify any areas that could be improved on. If you're considering a re-brand canvas their opinions and keep them updated.

Post purchase

As with all new business ventures, it's essential to get the basics right from the very beginning including:

• Implementing a comprehensive registration procedure.

• Ensuring robust recruitment processes, including rigorous checking procedures, are in place.

• Ongoing comprehensive risk and safety assessments are conducted regularly and adopted as part of the business culture.

• Making sure any issues that need correcting are dealt with without delay.

• Keeping up-to-date with, and working within, all Ofsted guidelines.

• Being aware of changes to the business and the individual care required by each child.

Most policies will allow for additional nurseries to be added mid-term (to ensure a common renewal date) but, if not, a separate policy will need to be purchased.

Towergate has been providing specialist broking services to the caring sector for more than 30 years. We can help protect your business, employees and children with cover from a leading insurer.

About the author

Jo Taylor is an respected insurance industry leader with over 15 years’ experience working with both education and the public sector. She is responsible for supporting her clients on all things insurance and risk related, and is also a mental health first aider qualified through Mental Health First Aid England.