The non-profit sector is an integral part of society that works hard daily to serve communities in America and worldwide. They engage in many activities, including education, health care, research and development, social services, advocacy for underrepresented groups, or another community improvement. The non-profit sector is also very diverse in terms of organizations’ size and structure. Some are small local groups with volunteers only; some others have hundreds of employees and a budget running into the millions.
A lot of nonprofit organizations, work diligently to fulfill their responsibilities so that their community stakeholders are satisfied with their work. There is also considerable risk involved in running a non-profit which can disturb their financial standing and even cause loss of donors and bad press. This is why they must have insurance policies for the organization and its members—if your nonprofit does not have these in place, there could be serious consequences if something goes wrong. In addition to making sure you have enough money on hand to cover your most pressing financial obligations, having an insurance policy can give your organization peace of mind as well as motivate your hardworking employees that you always have their back.
In this guide, we talk about the different types of insurance every nonprofit should have. We also give some tips on how non-profits can get the best deal possible.
General Liability Insurance for Nonprofits
If you’re sued, General Liability Insurance pays for your legal defense and can offer compensation if you’re found liable. This is vital because failing to protect yourself could result in an expensive lawsuit. For example, if a visitor trips on a cracked sidewalk that your organization didn’t fix promptly (even though it knew about it), and ends up injured as a result, that visitor may sue for medical costs and pain-and-suffering. This will lead to an expensive settlement process that has the potential to completely ruin your scarce budget
With cyber-crime increasing at a rapid pace, even nonprofits are not safe. Hackers pose a significant threat to nonprofits who see them as an easy target because of their lack of good IT infrastructure and lack of insurance. Having cybersecurity insurance protects you against damages incurred in hacking incidents and grants you access to an expert’s advice on how to prevent such attacks. If you don’t have coverage, look into purchasing it—your business depends on it.
Directors and Officers
Directors and Officers insurance provides coverage to nonprofit directors and officers in case they are named in a lawsuit. It also covers your board members if you are sued for wrongful termination or employment discrimination. If this insurance doesn’t get offered, then a lot of people might not do their jobs to the best of their abilities. You might even struggle to attract top-notch human capital to your non-profit organization.
Umbrella coverage is a specialized form of insurance that protects you and your business against major liability claims. It’s typically purchased in addition to a standard commercial general liability policy, and it kicks in when you’re the policy’s coverage limit has been exceeded. If you haven’t purchased umbrella coverage, and a claim exceeds your standard policy damages, you could be personally responsible for paying out-of-pocket costs. This would include anything from legal fees to monetary damages. This is why it is crucial to get umbrella coverage.
Due to global warming natural disasters are increasing at a rapid pace. A lot of premises are at risk from this threat including yours. With earthquake insurance plans you can have peace of mind knowing that you will get access to funds on an immediate basis to kick start your recovery process and get back out there to serve the community and achieve your goals.
Any organization with workers (volunteers, paid employees, interns) should make sure that they are protected by worker’s compensation insurance. This type of coverage protects your business against claims filed by employees injured on the job and will pay them benefits while they are unable to work because of their injury. Each state has different requirements for having worker’s compensation insurance, so contact experienced agents to find out more about local laws and how to obtain a policy.
Property insurance helps cover damage to your property and any liability that may occur from having it. It is also often required by a bank if you’re leasing or buying a new facility. It can also help protect your staff members and volunteers in case they are injured while on site. The importance of having property insurance is critical as floods and Hurricanes become the norm in America. The damages and losses caused to their premise can be so huge, that it is beyond their means to repair or rebuild them. This is why having property insurance is vital.
Commercial Auto Insurance
It’s wise to carry business automobile insurance for your business owned vehicle and other cars you may operate in your line of work. If you injure someone or damage another person’s property, you could be held financially responsible. This is true even if it was an accident and someone else is at fault. Fortunately, auto insurance covers many types of accidents, both yours and those that cause injury or property damage to others. They also help protect the expensive automobiles that your employees use for their work.
Errors & Omissions (E&O)
E&O insurance covers you in case an error or omission on your part leads to someone else suffering a loss. For example, if a nonprofit donates $100,000 worth of coats to an organization and neglects to disclose that one coat is infested with fleas, E&O would provide coverage for their customer’s losses.
Product Liability Insurance
Product liability insurance is an important aspect of doing business including for non-profits. A lot of NGOs can make T-shirts to sell to raise money. A slip-up in preparing a product or delivering a service could lead to a lengthy, expensive, and bizarre lawsuit. Liability insurance can protect your assets from these lawsuits, as well as provide you with the legal representation necessary to defend yourself if you are sued for any reason.
This is why it’s an absolute necessity for every NGO owner as it protects your organization from the potential of a lawsuit if you are found liable for injuries caused by your products.
Employee Misconduct Liability
Employees are considered to be a company’s greatest assets, but they can also be the worst nightmare for employers. Even if a company employs only one person, there is always some sort of risk that that person could do something wrong at work that would make the employer liable for damages. This is especially true in employment law where numerous rules must be followed and many activities are prohibited or restricted by law.
This is a serious problem that costs businesses millions of dollars every year. Many assume that the only solution to this issue is through litigation, but there are other ways to deal with and avoid lawsuits while at the same time preventing employee misconduct. One way is by having an employee misconduct policy to help protect your organization in case a volunteer or staffer causes harm to someone on behalf of your organization (or themselves). They cover bodily injury and property damage, as well as personal injury or wrongful death caused by an employee who is acting within their capacity with your non-profit.
Group Health Insurance
Non-profit organizations, whether they be religious, political, or charity groups have a lot to deal with. They have to manage their finances and also raise money to continue their work. But managing the wellness of their employees is just as important as any other area of the business. For a lot of people, a significant area of concern is their health insurance.
Good Nonprofit organizations work hard to keep their employees happy and healthy. By offering competitive group healthcare benefits they can attract, retain, and motivate the best talent. Nonprofits usually have more modest resources than other organizations, which can make it challenging for them to provide quality coverage without breaking the bank. This is why with some careful planning; your organization can help keep your employees stress free through group health insurance plans
With good health insurance, your employees will not have sleepless nights overpaying their medical bills if they end up getting sick or injured.
Tips to Get the Best Non-Profit Insurance
Non-profit organizations are faced with many financial challenges. One of these challenges is how to plan for the future and handle future uncertainties. Part of planning for the future is providing a safe environment that is free from injury to staff and members. The insurance that is purchased will help support the welfare of your organization as it can cover claims such as workers’ compensation, property damage, and more. However, you must budget appropriately and realistically for your insurance needs.
Otherwise, it might become hard to maintain a steady balance sheet which is a crucial aspect of running a non-profit organization. To make the most optimal use of your donations and grants you need to ideally find experts that can help you get the best quotes.
They will help you decide how much insurance coverage to get. You can even start by answering a few questions yourself such as: How much is your program budget? How big is your staff? Do you have volunteers? As a nonprofit leader, knowing how much money you can spend on insurance will ultimately inform which protective services you decide to purchase for your organization. By getting good insurance brokers on board you can get the best quotes on insurance policies. In
Factors that Affect Insurance Premiums
Your insurance needs will vary depending on your nonprofit’s size and form. But like your car insurance or home insurance, some underlying factors will affect the cost of your non-profit insurance. Some of these factors include:
- Age of your employees
- Past claims History
- Duration of policy
- Geographical location
- The Type of Insurance Plan
Get the Best Nonprofits Insurance Today
Nonprofits are usually underfunded. They often do not have the resources to hire an in-house attorney or even a full-time staff member to deal with insurance matters. This can make it difficult to prioritize and plan for insurance needs. Fortunately, there are ways you can reduce the cost of your insurance and still have the coverage you need to minimize the risk of disaster.
You don’t have to face the learning curve alone. If you run a non-profit or a church and are looking for the best non-profit insurance agents in California, Arizona, Nevada, Ohio, Texas, and Washington, then we at Integrity Now Insurance can help. We offer a range of services including property insurance, liability coverage, commercial auto insurance, and Directors liability insurance. When you choose us, you will be able to feel confident that your assets are protected in all types of situations. We are passionate about nonprofits and churches and work hard to get you the best policy quotes from insurance companies.
Contact us now for more information about our policies and how they can protect your nonprofit or charity.