What non-profit organization insurance covers

General liability pays when a member of the public is injured at your premises or your event, or by something you served or sold: a fall at a fundraiser, an injury on a field trip, a dish at a potluck. It provides the additional insured status venues and grantors ask for, and it extends to volunteers acting on the organisation's behalf, which is a wording point to confirm on the form. Special events held off-site, alcohol served at a gala, and fireworks or inflatables each need to be declared, because carriers rate or exclude them individually and a venue's certificate request often mentions them by name.

Directors and officers coverage defends and pays claims that arise from how the organisation is governed rather than from a physical accident: a decision to close a programme, a fired executive director alleging wrongful termination, a member claiming the bylaws were ignored, a donor alleging funds were misused, a regulator investigating the board. It insures the individual directors and officers, the organisation itself, and usually employees, volunteers and committee members. On most non-profit forms, employment practices liability is either built in or added, and it is the source of most claims.

Two features decide its value. The policy is claims-made, so it pays only for claims first made during the policy period, and dropping it exposes the board to claims about earlier years unless tail coverage is bought. And the defence costs are often paid inside the limit, so a long employment dispute can consume the limit before any settlement.

Volunteers are not employees, so a volunteer who breaks a wrist building a ramp or is hurt at a shelter has no workers compensation to claim on. Volunteer accident coverage pays their medical bills up to a limit, regardless of who was at fault, and often a small amount for accidental death or dismemberment, with no need to prove the organisation was negligent. It is inexpensive, keeps a volunteer injury from becoming a liability suit, and is written either as a blanket over all registered volunteers or by activity. It does not cover a volunteer's own car, which is the next section.

When a volunteer drives clients to appointments or delivers meals in their own car and causes a crash, their personal auto policy responds first, and the organisation is sued as well. Hired and non-owned auto liability pays the organisation's share and its defence; it does not repair the volunteer's car. A van or truck the organisation owns needs a commercial auto policy in its own right, with the drivers listed and screened, since a passenger van full of clients is a substantial exposure.

Property coverage insures the building you own or the contents and improvements in the space you rent, plus equipment carried to events. Crime coverage pays for embezzlement by an employee or volunteer treasurer, forged cheques and a fraudulent wire, and grantors increasingly ask for a fidelity limit as a condition of funding. For any organisation that works with children, the elderly or people with disabilities, a sexual abuse and molestation section is a separate coverage with its own limit and its own underwriting: background checks, a two-adult rule and written policies. Without it, such claims are excluded from general liability on most forms.