What Type of Insurance Does a Nonprofit Organization Need


If your organization is a nonprofit, you’ll need to carry what type of insurance does a nonprofit organization need Some insurers specialize in offering non profit insurance policies with several coverage options. A basic package typically includes general liability insurance, business interruption insurance and commercial property insurance. An independent agent can help you determine which options best suit your needs.

If someone slips and falls while visiting your nonprofit’s offices, the company could be sued for medical bills and lost income. That’s why premises liability insurance is an essential type of coverage for nonprofits. It can also cover damages for third party property damage (like slander and copyright infringement related to advertising) and business personal injury (like false arrest and invasion of privacy).

Nonprofits that use vehicles may need commercial auto insurance. This type of policy can protect the nonprofit if one of its workers has an accident in a company-owned vehicle or a hired/non-owned vehicle. Depending on the specifics of your nonprofit, you may also need to consider crime insurance, which protects the organization from theft by employees or volunteers. This is a common addition to a general liability policy and may also be available in a standalone policy.

Whether you’re running a small local charity or a large national or international foundation, there’s risk in any type of work. A lawsuit against a nonprofit could be costly, even if the claim is unfounded. Liability insurance is designed to cover the costs of litigation, settlements and legal fees.

In addition to standard liability policies, a nonprofit can also purchase directors and officers insurance (D&O). This policy helps protect board members, executives and volunteers from civil lawsuits related to decisions they make on behalf of the organization. It can also include employment practices liability (EPLI) coverage, which protects against claims that come from an employee’s actions during their tenure with the nonprofit.

If you’re not sure what types of insurance your nonprofit requires, an independent agent can help you find a policy that suits your needs. A good agent can assess your risk, identify gaps in coverage and recommend additional policies. They can also advise you on state and federal insurance requirements, including workers’ compensation and disability policies.

What is a Nonprofit Organization?

A nonprofit organization is a group that’s tax-exempt under federal law. It is usually run by a board of directors or trustees and can be a registered or unregistered entity. Nonprofits often serve a social or humanitarian purpose, and some provide educational programs for the public. Some of the most prominent nonprofits include schools, churches, literary organizations, hospitals and charities.

Nonprofits that have paid employees must comply with all applicable state and federal employment laws, including providing workers’ compensation, unemployment and disability insurance. An employer must also carry general and professional liability insurance, as well as commercial auto and property insurance.

There are many types of coverage available to protect your nonprofit. An independent agent can detail the specific policies that will best meet your organization’s needs. They can also provide a cost comparison for various providers and offer policy bundling options to save you money.