What Type of Insurance Does a Nonprofit Organization Need

There are a wide range of risks that nonprofit organizations face, from accidental injuries to property damage. The best way for charitable organizations to protect themselves from these dangers is by getting the right type of what type of insurance does a nonprofit organization need While each charity will have different insurance needs, there are several types of policies that are essential for most. The following are 7 key coverages that should be included in any non-profit policy: general liability, directors and officers insurance (D&O), commercial auto, business interruption, professional liability, employment practices liability, and umbrella insurance.

General liability insurance is one of the most important insurance for any nonprofit to have as it provides protection in the event that someone is injured on your property or if they damage your property while working with you. It’s also helpful in the case of a lawsuit that may be filed by a third party against your organization for things like copyright infringement or false advertising.

Non-profits that have employees should also consider purchasing a workers’ compensation policy to cover them in the case of an injury or illness while at work. While this isn’t a requirement, it’s an excellent idea to have in place to keep your employees and volunteers protected.

If your charity has vehicles that are used for events or for work, then commercial auto insurance is an absolute must. Depending on your state’s laws, you may need to add hired and non-owned auto liability as well as auto physical damage coverage. This type of coverage pays for damages if an employee or volunteer is involved in an accident while using a nonprofit vehicle.

In the case of a disaster that disrupts the work of your organization, business interruption insurance will help to cover any lost revenue during this time. This is normally included with a property insurance policy or can be purchased as an independent policy.

Directors and officers insurance, or D&O, is an important policy for nonprofits because it will protect the directors of the organization in the case of a lawsuit alleging financial mismanagement or fraud. The policy can also cover other members of the board as well as staff and volunteers.

Professional liability insurance, also called management liability, is another great insurance for nonprofits to have in the case of a lawsuit. The policy will typically cover negligence, copyright infringement, personal injury and more.

Umbrella insurance is a great addition to any of these policies, as it will offer additional protection in the case that an incident goes beyond the limit of an existing policy. This is typically an inexpensive policy that will give your charity the peace of mind it needs to continue its good work.

If you’re in need of a new nonprofit policy, or would like to review the existing ones that your charity has, then it’s a good idea to speak with a specialist. They will be able to help you figure out the type of policy that is right for your charity and recommend any extra coverages that you might need.