The Basics of Non Profit Business Insurance

Posted on: August 18, 2014 by Care Providers Insurance

The Basics of Non Profit Business Insurance

When it comes to insuring non profits, the most important thing to remember is that these organizations are much more vulnerable to financial losses, given that they rarely have a large amount of funds. A lawsuit or legal claim of any kind could be enough to financially devastate their business.

The most basic insurance coverage your non profit client will need is general liability. This coverage will protect their organization against allegations that someone suffered bodily injury, property damage, or some other type of personal injury arising from the organization’s premises, operations, or products.

Unfortunately, many non profit administrators assume that their general liability insurance will be enough to cover them against claims of negligence or bad advice when it comes to providing their services or products. In reality, professional liability insurance, also called Errors & Omissions (E&O), is the coverage they need to protect against liabilities resulting from mismanagement of the organization. Professional Liability Insurance also protects against workplace-related claims such as discrimination or sexual harassment.

Another important Non Profit Business Insurance coverage is Directors and Officers, or D&O, insurance. Your clients’ non profit’s board of directors and officers could be personally named in a lawsuit against that organization alleging fraud or financial mismanagement. So let’s say a board member invests the non profit’s assets unwisely and loses everything, a creditor could sue the non profit as well as it’s directors and officers, even if those members are volunteers.

Understanding the basics of non profit business insurance policies is essential for your clients, as well as for you. At Care Providers, we are committed to helping you place coverage for your nonprofit clients. Our mission is to provide coverages tailored to meet the unique needs of this market segment. Please contact us today to learn more at 1-800-970-9978.

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