Most nonprofits with paid staff need general liability, workers’ compensation, directors and officers liability and often professional liability, abuse and molestation, auto and cyber. The exact limits are usually set by grant agreements, government contracts and the lease. SF Coverage reads each agreement for free, marks every requirement as met or missing and names the exact endorsement to request for every gap.
Who sets your insurance requirements
- Government agencies and counties
- Specific limits, additional insured status for the agency and its officers, waiver of subrogation and notice of cancellation wording in the service contract.
- Foundations and grantmakers
- Evidence of liability and directors and officers coverage, sometimes with crime coverage for grant funds.
- Landlords and facility owners
- General liability with the landlord as additional insured, property coverage for improvements and primary and noncontributory wording.
- Schools and partner sites
- Certificates naming the district or site, plus abuse and molestation coverage when programs serve minors.
- Event venues
- A certificate for each fundraiser or gala, often with liquor liability when alcohol is served.
Coverage nonprofits usually carry
Exposures to get right
Grant and contract terms
Each funder writes its own insurance clause. A missing endorsement can delay reimbursement or a contract signature.
Volunteers and vulnerable people
Volunteers drive, supervise and handle money. Programs for children or vulnerable adults need specific abuse coverage and screening.
Board decisions
Directors can be named in claims about employment, funding use and governance even when they serve without pay.
Events and fundraisers
Galas, runs and auctions bring crowds, alcohol and venue contracts that each ask for a certificate.
In California
- California Corporations Code section 5239 gives volunteer directors and officers of nonprofit corporations protection from personal liability for ordinary negligence, and that protection depends partly on the organization carrying or trying to obtain general liability insurance.
- California law requires workers’ compensation coverage for employees, including part time staff. Volunteers are treated differently and need their own review.
- Many 501(c)(3) employers in California may choose the reimbursable method for unemployment insurance with the Employment Development Department instead of paying the standard tax rate, which affects budgeting for layoffs.
How SF Coverage works for nonprofits
Have these ready
- Current grant agreements and government contracts with their insurance sections
- Your lease or facility use agreements
- Annual budget and number of paid staff and volunteers
- Programs served, especially any serving minors or vulnerable adults
- Current policies, declarations and renewal dates
- Events planned for the next twelve months
Insurance for nonprofits, answered
Does a nonprofit need directors and officers insurance?
Most nonprofits with paid staff or grant funding should consider it. Board members can be named in claims about employment decisions, use of restricted funds and governance, even when they volunteer. Many foundations and some government contracts ask to see it. SF Coverage reads your agreements and shows which ones require directors and officers coverage and at what limit.
What insurance do county and city contracts usually require?
Government service contracts often ask for general liability, workers’ compensation, auto and sometimes professional liability, with the agency named as additional insured and a waiver of subrogation. Some ask for notice of cancellation wording that insurers rarely provide. SF Coverage reads the contract before you sign and lists each requirement as met, missing or not yet evidenced on your current policies.
Are volunteers covered by our insurance?
It depends on the policy. Many general liability policies include volunteers as insureds while acting for the organization, but workers’ compensation usually does not cover them automatically, and a volunteer’s own auto policy is often primary when they drive. We review your forms and show exactly how volunteers are treated before an incident tests it.
Do we need abuse and molestation coverage?
If any program serves children, older adults or people with disabilities, it is worth reviewing carefully. Many general liability policies limit or exclude abuse claims, and schools or funders often require a separate limit. Specialist insurers are often needed for this coverage, and they will ask about screening, training and supervision policies before offering terms.
How does SF Coverage help with our renewal?
SF Coverage starts renewals 90 days before expiry and explains each change in premium, limits and exclusions against your budget, staff, programs and sites within two business days of terms arriving, with compensation shown on every proposal. If another broker holds the account, send the renewal offer and expiring policies for a free second opinion within three business days.
General information. Coverage depends on the policy an insurer issues.