Expelling Common Myths about Non Profit Liability Insurance

One of the most common misconceptions your clients have about Non Profit Liability Insurance is that their nonprofit of social services business is too small to need an insurance policy. This can be a costly error to make, as no matter how big the operation is, a nonprofit will always benefit from a risk management strategy and protection planning. Funds are typically tight in charitable businesses, so chances are that their company would not be able to comfortably tackle a liability claim of any kind.

According to many insurance experts, this is not the only myth associated with Non Profit Liability Insurance. Other common misconceptions include:

Myth #1: State laws will protect the non-profit against the threat of lawsuits. Today there are only a few states that have adopted model statutes to provide liability protection to all volunteers, including directors, working for charitable organizations. Your clients should check with their own state laws before assuming they will be protected without the appropriate Non Profit Liability Insurance policy.

Myth #2: A General Liability policy is enough. General liability covers basic exposures, such as premises and operations. Your client’s nonprofit organization’s officers will likely not be protected under a stand-alone general liability policy.

Myth #3: Directors and Officers Insurance will protect against employment-related lawsuits. Simply put, executive liability policies don’t protect against most employment-related lawsuits. It is instead important to look into extending your coverage for employees and purchasing an employee benefits liability policy.

These are just a few of the common misconceptions related to Non Profit Liability Insurance. Your clients should investigate what specific state laws they need to abide by for their operation, and should be aware of their unique needs.

The above mentioned policies are just some of the essential Non Profit Liability Insurance Coverages that your clients should be aware of. At Charity First, we are committed to helping you place comprehensive coverage for your non profit clients. Our mission is to provide coverages tailored to meet the unique needs of this niche market segment. Please contact us today for more information at (800) 352-2761.