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Early childhood business insurance

Insurance cover for early childhood centre closures due to Covid-19  

Client advisory - Update 19 August 2020

We wanted to update you on what the move to alert level 3 for the Auckland region on 12 August means for holders of early childhood business insurance.

This advisory aims to provide answers to questions about the policy and how it responds.

Availability of cover 

The insurers have confirmed the Level 3 closure that commenced on 12 August 2020 in the Auckland region is a new and separate claim from the closure which began on 24 March 2020.

A deferment period of 48 hours applies to all new claims. This means that loss incurred in the first 48 hours will not be paid as part of your claim.

Your insurance policy may not provide cover for claims arising out of infectious disease. Cover for infectious disease claims is no longer available for new policies, or for most policies that renewed after 20 March 2020.

If you are uncertain if your current policy includes cover for Covid-19 closures please check your renewal/policy documentation or contact your broker.

Policy response during different alert levels

Alert level 3 and 4

The policy will respond for losses, such as lost fee income, where parents keep their children at home following Government guidelines for level 3. Note that:

  • A deferment period of 48 hours applies for any loss. This means you cannot claim loss incurred in the first 48 hours.
  • If you lodged a claim for the closure earlier this year, you will be able to claim up to the balance of the sum insured for subsequent closures in the same period of insurance.
  • The policy provides cover up to 25% of your annual turnover subject to a maximum sum insured of $250,000 per site for the period of insurance.

Alert level 1 and 2

At alert levels 1 and 2, early childhood centres are allowed to operate and the policy does not respond.  

Claims process

To place a claim for the August 2020 closure affecting the Auckland region, please check Claims information requirements - August closure for guidance on the steps to take and information you need to provide.  

If you have not yet submitted a claim for the March 2020 closure please see Claims information requirements - March closure  

Further information