Insurance for Animal Welfare Organizations
Just like individual and businesses, nonprofits need insurance for their property and to protect against potential liability. Property policies will insure buildings, equipment, and/or vehicles against potential theft, loss, breakage, or destruction, whether from people, animals or weather events. Depending on your state, you may or may not need specific policies for some natural disasters, such as floods, hurricanes, earthquakes, and sinkholes.
Even all-volunteer organizations, and those without a physical shelter, need insurance. Claims may arise from foster animals, people who participate in fundraisers or attend events, or any number of actions taken in support of your organization.
If you have even one employee, your organization could potentially face legal action and lawsuits regarding compensation, workplace policies or incidents, and employee termination. Directors and board members/officers may be at particular risk, which is why there is special coverage, often referred to as “D&O insurance” to protect them. This Guidestar article explains more about it, what it might cover, and how it works.
Of course, no two animal welfare organizations are exactly alike. So, the insurance protection your peers have at other organizations might not be a good fit for your organization. Additionally, insurance “products,” or the type of policies/coverages they offer, are regulated by each state. That means that the same companies, coverages, and policies are not offered nationwide. The Nonprofit Risk Management Center offers a free, downloadable guide to state liability laws.
So, how does an organization find a good fit for insurance? How much liability coverage do you need? Will you need multiple policies to cover different types of risk? Fortunately, there are professional insurance brokers who will research these questions for you, and provide you with alternative products from various companies. What’s more, your organization does not have to pay them; they are compensated by the insurance companies. Learn more about brokers from Charity Channel. United Policyholders is a nonprofit organization that can help you find providers and brokers and make sense of your state’s insurance regulations.
And what about your volunteers? Are you liable for their actions? Check out The Nonprofit Times for a summary on this issue. There are a number of federal and state laws regarding charitable work done by volunteers. The Volunteer Protection Act of 1997 was intended to indemnify volunteers who are acting on behalf of a charitable organization. If their actions are deemed negligent, they can still face civil liability. However, a study by the two Michigan law professors could identify only a scant handful of cases against “ordinary volunteers.” You can view your state’s laws at Charitable Immunity laws by state.
For more comprehensive information about insurance for your organization, you might find A Nonprofit’s Guide to Risk and Insurance useful.