Miranda sat at her desk staring at the empty spots on her daycare’s sign-in sheet. A year ago, every classroom in her San Antonio center had been full. Now, enrollment was down, revenue was shrinking, and the bills on her desk seemed taller every week. Payroll still had to be met. Snacks still had to be bought. And then her daycare business insurance renewal landed in the mailbox with a number that made her stomach twist.
She flipped through the pages, hoping she had misread. The premium was higher, even though she had fewer kids enrolled. That made no sense to her. How could her costs go up when her revenue was going down?
That night she lay awake thinking about the future. Would she have to raise tuition on the families who were already stretched thin? Could she cut staff hours without hurting the quality of care? Every option felt like it would make things worse.
Miranda’s frustration grew until she finally called a Texas daycare insurance specialist for help. She discovered something she wished she had known sooner. Lower enrollment does not just mean less income. It can also change how your liability insurance is calculated. The trick is knowing how to work with an experienced agent to make sure your policy reflects your real numbers.
Here are three things every daycare owner in Texas needs to know when enrollment declines.
There is also a FAQs at the bottom of the page. Now back to Miranda's Story.
When Miranda first saw her renewal from the insurance provider, she assumed her business insurance premiums were set in stone. What she learned was that liability insurance premiums are based in part on revenue. This is especially true for general liability coverage.
If your business income is down because fewer children are enrolled, your liability exposures for those types of coverage are lower. That means you may be able to update your values at your renwal to reduce the premium you are paying.
The key is to act. Insurance companies will not automatically lower your bill just because your enrollment dropped. They have no way of knowing if you are not audited or proactively telling them.
You need to work with an agent who understands daycare operations in Texas and can show underwriters how your numbers have changed. Miranda’s independent agent who is a daycare specialist reviewed her financials with her and submitted updated revenue figures. Her revised premium on her business owner's policy reflected the new numbers and gave her needed relief.
When money is tight, it is tempting to look at your insurance costs and wonder what you can cut from your policy. That was Miranda’s first thought too. But then she remembered what had happened to another daycare owner in her network who faced an abuse allegation without proper liability coverage. Even though the claim was false, the defense costs nearly closed the center for good.
Miranda was reminded that cutting corners on what insurance covers could put her entire business at risk. Lower enrollment meant she had even less margin for surprise expenses. She needed a solid risk management plan rather than just removing coverage.
One uncovered claim could wipe out everything she had built. Instead of reducing her coverage, she worked with her agent to make sure her policy still included the essentials every daycare business owner needs beyond basic general liability.
What she discovered is that protecting against risk is even more important when income is low. You simply cannot afford to pay a six-figure claim out of pocket.
When Miranda’s revenue dropped, she thought her only insurance factor was the number of children enrolled. What she did not realize is that insurance companies also look at loss history and how well a daycare is operated.
If you have had prior claims, even small ones, they stay on your record and affect how insurers view your business. Proper risk controls and safety programs help you avoid claims that can have a prolonged effect on your insurance costs.
The good news is that strong operational practices and safety plans will also help attract new parents into your center. Clean inspections, solid documentation, and updated safety protocols also show underwriters for your business insurance that your daycare is still a safe bet. This is a double bonus!
Miranda thought she had no control over her business insurance costs when enrollment dropped. She thought the only way forward was to cut staff, raise tuition, or pay higher premiums. These are things that no business owner wants to wrestle with.
Instead, she learned that an experienced daycare insurance specialist could help her adjust her policy, protect her coverage, and tell her story in a way that insurance companies respect.
She walked away from the experience with lower premiums, proper coverage, and peace of mind that her daycare could weather the storm. That is the promise of certainty.
Enrollment dips are happening to many Texas daycares right now. A new competitor opens down the street. Families move. Economic pressures cause parents to cut back. These things are outside your control. But how you respond with your business insurance renewal is within your control.
Do not assume that fewer kids means higher premiums. Do not cut critical coverage in a moment of panic. And do not let underwriters draw their own conclusions about your program without telling your side of the story.
That is why True Texas Education Insurance exists. Built specifically for daycare business owners in Texas, it helps you adjust your coverage to fit your reality, protect your business from gaps, and keep insurers on your side. And it is only available at Insurance For Texans.
👉 Click the button below to talk with a Texas-based daycare insurance expert today. Learn how to protect your business, your staff, and your future even when enrollment is shrinking.