According to statistics, nonprofit organizations are often a common target for litigation each year. Many nonprofit organizations operate on a budget that can't survive a significant unexpected expense. Even though these organizations' goals are to help people, they are still running businesses.
That means if you run a nonprofit organization, you need to protect yourself against the risks that small business owners face. The best and sometimes the only way to protect such organizations is to have the right insurance coverage. If you have a nonprofit organization, partner with an insurance agency that understands the needs of charitable entities.
What Types of Insurance Coverages Do Nonprofit Organizations Need?
There is no specific must-have list of insurance policies that nonprofit organizations should buy. Instead, since no two organizations or businesses are alike, a nonprofit should rely on the expertise of an insurance agency with experience in nonprofit insurance to help them find the best insurance coverage for their needs. Some of the common nonprofit insurance policies in Dallas you should consider include:
General liability insurance: This insurance covers claims by third parties for property damage or personal injury that happened during the nonprofit's events or operations.
Property insurance: This policy protects all the property within the nonprofit organization, whether owned or rented. It covers damage or loss to buildings, machinery, furniture, computers, equipment, or other items of value. Common claims include fire and theft, and not all insurance policies cover natural disasters.
Workers' compensation insurance: This type of insurance offers compensation for employees who get injured on the job. The coverage provides payment for wages, employee benefits, and medical expenses if an employee gets injured while working for the organization.
Cyber liability: Nonprofit organizations are more susceptible to cybercrime due to a lack of high-security measures. If your organization collects sensitive personal or confidential data, you must have cyber liability. This policy will protect your organization in the event of a data breach through external or internal hacking.
Directors' and officers' liability: This is must-have insurance coverage for people working in the nonprofit sector. It covers damages caused by decisions made by directors and officers of a nonprofit organization. The policy protects the organization and board members.
Comprehensive auto: If your organization owns vehicles, you should buy comprehensive auto insurance. It covers owned fleets. You can also buy non-owned auto liability for volunteers.
Professional liability: This policy is also known as errors and omissions insurance. It protects the board director from claims due to their action or inaction. It also covers the volunteers, staff, and the nonprofit organization itself.
Crime coverage: While doing charitable work is noble, you cannot be naive to assume that everyone willing to be part of your team can be trusted. Crime coverage protects you from dishonest employees or volunteers who may steal from you. This coverage can also cover your clients' assets in your possession.
Other Policy Options for Nonprofits in Dallas
Each nonprofit organization is unique. For this reason, some insurance agencies offer customized nonprofit insurance policies to fit their client's needs. Other nonprofit insurance options in Dallas you can consider include:
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Umbrella coverage
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Special event coverage
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Unemployment coverage
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Employment practices liability insurance (EPLI)—including allegations of wrongful termination, retaliation, workplace harassment, and discrimination
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Fiduciary liability
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Additional insured
Should a Home-Based Nonprofit Get Insurance?
Consider adjusting your renter's or homeowner's insurance policy. It is advisable to be upfront with your insurance agency about your intended activities from your home and get the appropriate insurance coverage in advance. If you fail to disclose this to your insurance agency, your coverage could be rendered void or limited.
What Types of Nonprofit Organizations Require Insurance Coverage?
Any nonprofit that engages in vocational training, counseling, or other kinds of instruction has significant liability exposure. This includes educational organizations and charities, volunteer health organizations, churches, and religious organizations. Additionally, organizations that mainly maintain client data online, employee records, and donor financial files should also consider buying nonprofit insurance in the event of cyber-attacks or data breaches.
How to Pick the Best Insurance for Nonprofits
Many nonprofits work on a shoestring budget, limiting their options when it comes to buying insurance policies. The following factors determine the cost of nonprofit insurance:
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The size of the nonprofit organization's property
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The number of employees and volunteers working for the organization
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Types of services offered by the organization
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Whether or not they depend on special equipment to operate
Choose Thumann Agency, Inc. for Your Nonprofit Insurance in Dallas
At Thumann Agency, we help nonprofits find the right solution when it comes to nonprofit insurance. For more information about nonprofit insurance in Dallas, contact our insurance specialists at 972.991.9100 today!