I don't think insurance is a legit reason for no volunteers. If you truly think it is I would suggest looking into it so you know for sure. If you just don't want a volunteer and that was the easiest answer...you might need a better answer!

It is ok to just not want another adult in your space. But you have to own up to that and tell the parents. I would be truthful and clear. It can look a bit suspicious to be trying to blame the insurance which may lead a nervous parent wondering what you are trying to hide.

I would rather be told that you find it throws the children's routine off with an extra adult in the mix, or that training and supervising a volunteer just takes time and effort away from the children so you prefer not to. Versus hearing you can't because of insurance and being left to wonder what the real reason is.