A non profit is an organization that does not pay out its extra earnings to investors or a board of directors but reinvests that money into the business to accomplish its mission.
Non profits can include a variety of different groups, from dog rescue organizations to Aquariums, and although each has its own unique mission and purpose all have to operate by certain standards and implement certain best business practices.
One of the practices that all non profits will have in common is insurance. Non profit business insurance plans will vary in size and policy types depending on the size of the non profit.
What type of insurance does a non profit need?
There are a lot of different types of insurance that non profits should look into, but the 3 most important are commercial business insurance, vehicle insurance and property insurance.
These 3 types of coverage can handle most of the non profit’s needs in case there is an incident like an employee that is injured on the job, a car accident in a company or personal vehicle or property theft.
Non profit organizations can also look into purchasing directors and officers insurance, which provides coverage for your management team in case they are accused of improper actions. These types of claims can range from sexual harassment charges to discrimination or wrongful termination.
Regardless if the claims have merit or not, legal fees can be incredibly high and make a financial impact on any non profit organization.
How do I know what type of insurance is best?
There are a lot of online resources for non profits from the federal and the state government that cover non profit related topics including fundraising, legal structure and insurance needs.
Research multiple sources before deciding what is best for your non profit, and consider speaking with an attorney to help you accurately assess risk. Always get a few quotes from several insurance companies to compare pricing and plan options, as the cheapest plan may not be the best fit for your organization.