Maximising Protection: A Guide to Insurance for Schools & Creches

If you own or run a school or crèche, you may need insurance for schools. At Auto and General, we know how important your school or daycare centre is to you and the parents of your learners. We have prepared this article to help people like you learn why this type of business insurance is crucial. Not only will you learn what it is, but you’ll also discover what risks it protects you and your school or crèche against.

Is a school a business? Why do you need insurance

The easy answers to these questions are, “Yes, schools are a business, and they do need insurance” However, it’s worth explaining why this is the case and it’s best to approach this in two parts.

• Reasons why a school is considered a business   

A business is created to make a profit consistently. Whether a school is a business or not depends on the type of school. There are two kinds of schools: public schools and private schools.. Public schools are non-profit organisations, which means they are created for social or public benefit. Quintiles classify these schools to establish the level of government funding.

The operations of all public schools resemble that of a small business. For example, they create budgets, have organisational structures, and have to maintain their buildings.

Private schools are far more business orientated than most public schools. This means that they must make profits to operate. Parents or caregivers of the students fund a private school. The school does not receive government funding. 

• Insurance for schools - why it’s needed

All schools need insurance, regardless of whether it’s insurance for public schools or insurance for private schools. Since a school is a small to medium-sized business enterprise, it follows that it needs to have insurance. Like any business, it is exposed to various types of risks. For instance, it may lose some or all its buildings due to a fire or acts of nature. Without insurance, the school or daycare may struggle to rebuild damaged or destroyed properties. 

Potential risks at schools and crèches

It’s not only primary and high schools that face business risks, crèches or daycare centres also have risks. Some of these include: 

• Public liability risks

Third parties may be injured or the properties damaged at the school by parents, pupils, caregivers, or suppliers. For instance, a softball may smash crack the windshield of a vehicle parked on the school premises. The owner may claim third-party liability for the cost of repairs. 

• Property damage risks 

School properties are exposed to the weather and possible vandalism. In 2020, vandalism of public schools[1] occurred across the country, and it can happen to any school or crèche. 

• Crime and theft

Schools are becoming targets of crime and theft due to technology's introduction to improving learning. Many schools have expensive computer labs. Some schools provide their learners with tablets to improve learning and teaching. Sports equipment is a very costly investment for a school. These items could be lost due to a break-in or opportunistic theft. 

• Professional liability risks 

A school provides educational services, so it’s possible that a teacher, caregiver, administrator or service provider hired by the school could provide inaccurate advice or care.  For instance, a schoolteacher may provide first-aid during a sports tournament on the school premises.  If a pupil received inadequate first aid, there could be legal repercussions. 

Benefits of having insurance for schools and creches

Having school or crèche insurance comes with certain benefits. Sometimes, a learning institution must have such insurance to receive funding or comply with health and safety regulations. Here are some benefits of having this type of insurance. 

• Compliance with legal or government regulations: The school must comply with the country’s laws, such as the Employment Equity Act and Occupational Health and Safety Act. Failure to abide by these laws can lead to repercussions such as loss of operating licence. If sued and you have insurance,  the school’s legal costs will be covered. If there’s a need for settlement, the insurance could also payout. 

• Protection against financial loss: If a school had to settle a third-party claim, insurance would cover this settlement, and the school wouldn’t have to dip into its funds. No public or private school can afford to run at a financial loss. This is especially true for private schools as they may struggle to pay teacher or caregiver salaries. 

• Cover for staff or professionals at your school: Teachers and caregivers are essential assets at a school or creche. Unfortunately, a teacher’s actions may be considered negligent and could cause harm or loss to someone, like another staff member or a learner. Insurance for teachers, in the form of liability insurance, will ensure that the school and teachers are covered. 

• Reputation management: Insurance for schools helps protects a school’s reputation. Stakeholders would hold a school in poor regard if it garnered a stigma due to an incident or event where the school could not settle claims or restore damaged or stolen property. 

5 Types of school insurance needed 

Although it’s best to consult a trained insurance broker to discuss your particular insurance portfolio, the most important types of business insurance for schools and crèches should include some or all of the following: 

1. Buildings insurance: Most schools own or lease buildings such as administration offices, classrooms, sports fields and laboratories. These buildings are exposed to various risks, which could leave them damaged or destroyed. 

2. Contents insurance: There is costly equipment within some of the buildings mentioned above. For instance, science laboratories may contain expensive equipment such as microscopes. IT laboratories house computers and printers and may also have servers and expensive UPS devices. Contents insurance will financially protect the school in case of loss or damage. 

3. Public liability insurance for schools: No one knows when a learner or member of the public, such as a supplier or passers-by, could sustain an injury on the school premises.

4. Professional indemnity: If applicable, professional indemnity insurance will cover legal fees and a settlement.  A staff member, like a teacher, could be held liable for actions or behaviour deemed negligent or harmful to a staff member or learner, for instance. 

5. Commercial vehicle insurance: Does a school own vehicles such as cars, buses or combi? If so, you need to have commercial car insurance. This type of insurance covers damage due to a car accident or collision, theft, damage due to natural elements or fire, and third-party claims. 

The kind of business insurance you need depends on your school or crèche’s risk profile. It’s important to consult a trained business insurance broker to help identify your unique risks. Only then can you know what type of insurance is right for your school or crèche,

Get insurance for schools from Auto & General

Now that you’ve learned about insurance for schools, it’s time to get the right insurance cover. This begins with getting a free and no-obligation online quote. Our trained insurance consultants will work with you to identify your risks and tailor-made insurance.

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[1] IOL: Public schools buildings must be protected from vandalism

Disclaimer: The information in this article is provided for informational purposes only and should not be construed as financial, legal, or medical advice.