Steven has been in the daycare business for almost nine years now. He has seen the ups and downs that come with being in the daycare industry in Waco, but seems to have found a great balance between providing a great environment for kids and the risk management that comes with running a business.
To save some money, Steven has remained in charge of his bookkeeping, insurance, and other management tasks. It's not his favorite part of his work, but he knows that it helps keep a closer eye on his child care center operations.
Steven got his property insurance renewal in the mail the other day and began calling around to a few agents. He settled in on one big name insurance agent and two independent insurance agents to get proposals back to him so that he can compare numbers.
Three agents gave him quotes and he figured he would simply take the cheapest one. They are all the same thing right?
As he began to look, two proposals were pretty close to what he was already paying. But one came in almost 40% lower. Steve figured, “Why pay more for the same thing?” He signed the paperwork and thought he’d scored a win saving on his monthly costs.
A few months later, hail storms rolled in. One of them brought hail that punched holes in the roof. Water poured into a playroom and soaked the flooring. Steve filed a claim with his new daycare insurance carrier, thinking repairs would be handled in a matter of days.
Instead, he got a check that barely covered one-third of the cost. The insurance company told him his roof was too old, and they only paid out the value after depreciation. Steve was stuck with a five-figure repair bill, a mess to clean up, and a hard lesson to swallow.
What went wrong?
It turns out, that “great deal” he had signed came with strings attached. Big ones. Let’s walk through what every daycare owner should know before jumping at the lowest quote.
If you are short on time, here are the three things you really need to know right now.
If that isn't enough, here is a link to some quick FAQs for you. Now back to our regular story.
Most property coverage comes in one of two flavors: Replacement Cost or Actual Cash Value. One will pay to replace the property damage, based on today’s prices. The other takes into account the age and wear of what was damaged and then subtracts value based on how old it is.
Steve had a 14-year-old roof. And his new policy used a roof payment schedule. That meant the insurer factored in the roof’s age, not what it would cost to put on a new one. What looked like a simple fix on paper became a major out-of-pocket hit for Steve’s business.
It’s not just roofs, either. Some policies limit other parts of the property. Air conditioners. Flooring. Equipment. If the quote is way below the others, there’s a good chance something important has been downgraded.
Most daycare owners aren’t insurance experts. Steve already wears too many hats. So when his quotes show up with numbers and line items, it’s easy to assume it’s apples to apples.
But it’s not. Some apples are rotten!
Many quick quotes are built from generic templates. They’re fast. They’re automated. And they often skip liability coverages that daycare centers actually need.
These aren’t “add-ons” in a daycare setting. They’re essentials for liability risks you encounter.
Steve didn’t realize his new policy left out coverage for abuse and molestation risks. Nobody explained it. It wasn’t listed on the quote in a way that made it obvious. It just wasn’t included. If a parent had ever raised a concern or filed a claim, his business would’ve been left wide open.
Even worse, these missing coverages often don’t become clear until the moment you’re trying to file a claim. That’s a terrible time to find out.
If one quote is dramatically lower, the question to ask isn’t “Why is it so cheap?” It’s “What’s missing from this that the others included?”
Steve got his low quote from a friend-of-a-friend. He was polite. Responsive. And quick to get quotes back. But he didn’t specialize in daycare insurance and he didn't ask many questions.
That meant he didn’t ask the right questions. He didn’t dig into staff ratios. Or food handling. Or safety procedures. He had no clue what actually went on in a childcare facility.
Worse, he misclassified the building and answered some underwriting questions incorrectly. That led to a policy that didn’t fully reflect the real risks of Steve’s daycare. Which meant the insurer didn’t really understand what they were protecting.
Daycares are not like other businesses. You have kids in your care. You have licensing and training requirements. You’ve got pickup and drop-off liability. You run food programs. You keep safety logs. These aren’t small details.
An agent who doesn’t specialize in childcare may treat your business like an office or a retail shop. That’s how gaps get created. That’s how personal injury claims get denied.
The quote might look cheaper because it’s based on the wrong type of business altogether.
Steve thought he was saving money. He wasn’t trying to cut corners. He just didn’t know what questions to ask. And his agent didn’t guide him.
When the storm hit, it was too late to fix it.
He ended up spending far more out of pocket than he ever could have saved on premiums. He also had to answer hard questions from parents about why property repairs were taking so long. And he had to dip into his cash reserves just to cover the gap.
Daycare margins are already tight. One denied claim can push you into the red faster than you think. A quote that’s lower by a few hundred dollars a year might seem smart today, but it can cost you tens of thousands tomorrow.
The difference between a good insurance policy and a useless one isn’t always in the numbers. It’s in the insurance policies detail. The fine print. The exclusions. The way your story is told to underwriters.
Steve’s story is common. Too common. Daycare owners across Texas are shopping for insurance based on price, not protection. And they’re learning the hard way that not all commercial property coverage is created equal.
You deserve more than just a quote.
You deserve someone who understands what your business needs. Someone who knows Texas childcare regulations. Someone who knows how to tell your story to underwriters the right way so that when something bad happens, your coverage actually holds up.
That’s what True Texas Education Insurance was built for. To help daycare owners protect their business, their staff, and their future without playing games.
Click the button to talk with a Texas-based insurance expert who knows how to help daycare owners like you get the right protection. Not just the lowest quote.