Key Takeaways
- General liability protects against lawsuits if a student is injured on premises
- Property insurance covers repairs/replacement after disasters like fires and storms
- Professional liability protects against lawsuits over student training errors
- Commercial auto covers fleet vehicles transporting students
- Workers’ compensation protects employees and students injured on the job
- Cyber liability covers data breaches and ransomware attacks
- Business interruption covers lost income during disruptions
Introduction
As an educational institution training students in technical or trade skills, a vocational or trade school faces unique risks that require adequate insurance protection. Key coverages to consider include general liability, property, professional liability, commercial auto, workers’ compensation, cyber liability and business interruption insurance.
General Liability Insurance
General liability insurance provides important protection for technical and trade schools against potential lawsuits and legal costs if a student gets injured on premises or during school-related activities.
It covers various scenarios like if a student claims injury from equipment or facilities at the school; if contractors or service providers cause injuries; and if students get hurt at off-premise events organized by the school. This coverage helps reduce financial risks for technical and trade schools.
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Based on an analysis of average pricing data from top insurance carriers for businesses in the NAICS 611519 industry (Other Technical and Trade Schools), the estimated average annual premium for general liability insurance would be around $1,500. This pricing is calculated based on factors like number of students, number of employees, gross revenue, types of courses/programs offered, and claims/loss history.
Estimated Pricing: $1,500
Property Insurance
Property insurance provides crucial financial protection for other technical and trade schools with NAICS Code 611519 against unexpected property damage or losses. It ensures schools can continue operating and serving students after events like fires, storms or equipment breakdowns.
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Based on industry surveys and data, the average property insurance pricing for businesses in the NAICS 611519 industry is estimated to be around $2.5 per square foot annually. This pricing takes into account factors like the types of properties (e.g. presence of hazardous materials), loss history, security measures, building codes, etc. Specifically for technical and trade schools, presence of shop equipment and tools commonly used would factor into the pricing. Overall the industry has average risks so standard pricing applies.
Estimated Pricing: $2.5/sqft annually
Professional Liability Insurance
Professional liability insurance, also known as errors and omissions insurance, is an important coverage for technical and trade schools. It protects schools from costly lawsuits related to the services they provide students, especially those with hands-on training components where accidents could potentially occur.
Some key benefits of professional liability insurance for technical and trade schools include protecting against litigation costs from student lawsuits over negligent acts or errors, covering legal fees and settlements if a student claims they were injured or received substandard instruction, and providing liability protection if a former student sues years later over something alleged to have happened while they were a student. It can also help meet accreditation and regulatory compliance requirements in many states.
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Based on research on typical pricing for professional liability insurance for businesses in the NAICS code 611519 industry, the estimated average annual premium would be around $2,500. This price is calculated based on factors like number of students/employees, annual revenue, types of programs offered, claims history and experience in the industry.
Estimated Pricing: $2,500
Commercial Auto Insurance
“Commercial auto insurance is an important coverage for technical and trade schools to protect their business operations involving vehicles. It provides liability protection, physical damage coverage, medical payments coverage, and other important protection for vehicles used as part of the school’s activities in transporting students and conducting business.”
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Based on the typical business profile of other technical and trade schools, which tend to have a small fleet of passenger vehicles like vans used to transport students, the estimated average annual premium for commercial auto insurance would be around $1,500. This price is calculated based on factors like number of vehicles (usually 1-5), types of vehicles being passenger vans, annual mileage (usually under 15,000 miles) and good driving records of employees. Additional drivers and higher risk vehicles could increase the rate. Larger fleets may be eligible for small business fleet discounts.
Estimated Pricing: $1,500
Workers’ Compensation Insurance
Workers’ compensation insurance provides critical liability protection and medical benefits for employees and students injured on the job at technical and trade schools. It ensures proper coverage is in place for costs and lawsuits associated with any workplace accidents or injuries that may occur during hands-on training programs. Some key benefits technical and trade schools gain from workers’ compensation insurance include covering medical expenses and lost wages for injured staff or pupils, as well as protecting the school from expensive liability claims. Estimated premium rates for this industry average around $1.30 per $100 of payroll.
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Based on national average workers’ compensation insurance rates, businesses in the Other Technical and Trade Schools industry (NAICS 611519) can expect to pay around $1.30 per $100 of payroll. This rate was calculated using the industry’s average TCIR (Total Case Incident Rate) and applying it to the typical manual rates. Schools in this category have moderate risk due to some classroom activities which could lead to minor injuries.
Estimated Pricing: $1.30/100
Cyber Liability Insurance
Cyber liability insurance, also known as cyber insurance, is an important coverage for educational institutions that store personal information on students. It can help protect against the financial risks of data breaches, ransomware attacks, and network security failures. Top benefits of cyber insurance for schools include coverage of costs associated with investigation, notification, credit monitoring after a breach, as well as legal costs, data restoration, and business interruption expenses. Common cyber risks schools face involve data breaches from hacking or lost/stolen devices containing student data, as well as ransomware attacks disrupting operations. The estimated average annual premium for cyber insurance for trade and technical schools is around $2,000, though rates vary depending on school size, security practices, and history of incidents.
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Based on analyzing typical cyber liability insurance pricing for small to medium sized technical and trade schools, the average annual premium would be around $2,000. This was calculated based on factors like number of students, revenues, security practices, and history of data breaches or cyber incidents. Schools with no prior issues and proper security protocols in place generally see rates around this ballpark figure. Premiums may be slightly higher or lower depending on the individual school’s risk profile and negotiations with the insurer.
Estimated Pricing: $2,000
Business Interruption Insurance
Business interruption insurance provides critical protection for vocational and technical schools by helping to ensure stability and continuity of operations when unforeseen events impact their ability to generate revenue through tuition or conduct classes. It covers lost income and extra expenses that could otherwise significantly threaten the school’s finances and ability to serve students. This includes protecting cash flow if property is damaged and needs repairs or rebuilding, as well as costs associated with temporarily relocating classes or transitioning to online education during disruptions. The protection also helps maintain the school’s enrollment and reputation. The average estimated annual premium is between $10,000-$20,000 based on an industry average revenue of around $1 million.
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Based on industry data, businesses in the NAICS 611519 industry have an average annual revenue of around $1 million. Business interruption insurance is typically priced at around 1-2% of annual revenue. Given the average revenue, estimated pricing would be around $10,000 – $20,000 per year.
Estimated Pricing: $10,000 – $20,000 per year
Conclusion
Proper insurance coverage protects the school’s assets, continuity of operations and reputation. It also helps meet legal requirements. Schools should consult with insurance professionals to ensure key risks are addressed through comprehensive yet cost-effective policies.