According to the National Center for Charitable Statistics (NCCS), in 2016 it was estimated there are over 1.4 million non-profit organizations in the U.S. This number encompasses public charities, private foundations, fraternal organizations, labor unions, arts organizations, civic leagues, and churches. In addition to the Property, General Liability (GL) and the Workers Compensation that may be required according to state laws, each of these very different organizations may need to consider additional policies, according to the non-profit’s activities and mission.
Directors & Officers Insurance (D&O)/Employment Practices Liability
D&O is a type of liability insurance covering directors and officers of the non-profit for claims made against them while serving on a board of directors and/or as an officer for a breach or neglect of the entity’s finances. It Employment Practices Liability (EPL) covers lawsuits brought for “Wrongful Act,” from the employment process. The most frequent types of claims covered under such policies include wrongful termination, discrimination, sexual harassment and retaliation as defined by the U.S. Equal Employment Opportunity Commission (EEOC) . Policies define “Wrongful Act” differently, so be sure to look carefully at the list of exclusions.
Social Services, Counselors, Case Managers, etc. may have a need for this coverage. This is a type of liability coverage designed to protect traditional professionals and quasi-professionals against liability incurred as a result of errors and omissions in performing professional services. Although there are a few exceptions, most of these policies only cover economic or financial losses suffered by third parties, as opposed to bodily injury and property damage claims.
For coverage that generally covers the insured for claims related to unauthorized access, viruses or denial of service attacks that cause “network impairment” where it becomes necessary to restore the insured’s network to the way it was prior to a virus or hack. Property or GL policies often exclude this risk if the theft of hardware or if a data breach occurs. Anytime sensitive information is gathered or stored online of a personal or financial nature or if employees or volunteers use laptops and digital devices that could be stolen and scraped for data this coverage is worth considering.
Other coverages Jackson Sumner & Associates may be able to provide for your insured’s non-profit, depending on the type of non-profit and their activities, include:
- Hired/non-owned auto coverage – if the non-profit hires or uses their own vehicles
- Business / commercial auto liability – if they own their own vehicles
- Sexual and/or physical abuse – make sure it’s part of their GL or Professional coverage
- Crime coverage/employee dishonesty – may be provided with property or stand alone
Non-profits are a huge part of part of the U.S. workforce and economy, accounting for nearly 12.3 million jobs in 2016, contributing 5.4% of the US gross domestic product (GDP), and providing nearly 25% of Americans volunteering opportunities with a non-profit organization each year. It is important to provide these organizations with the protection they need to continue to grow and thrive.
Contact any of Jackson Sumner & Associates’ P&C Underwriters to learn more about any of these non-profit coverages and to build a package for your insureds that addresses their unique risks.
[chart and data: US Dept of Labor “Nonprofits account for 12.3 million jobs, 10.2 percent of private sector employment, in 2016” (August 31st, 2018)]