Central Oregon’s nonprofits do remarkable work. On any given day, they are helping children and families, supporting seniors, caring for animals, expanding access to housing and behavioral health services, and enriching our community through education and the arts.
I have worked with many nonprofit organizations over the years, both professionally and in the community. Their missions vary widely, but they share a challenge: they must manage the risks of running an organization while directing as many resources as possible toward the people they serve.
A nonprofit may have a small staff, a working board and dozens of volunteers. It may operate from a building it owns, provide services at several locations, or take its programs into schools and homes. Funding can shift from year to year, while the need for its services rarely does. Insurance decisions have to account for that reality.
Here are several areas nonprofit leaders and boards should revisit regularly.
Board and leadership decisions: Board members make decisions about finances, staffing and the direction of an organization. Directors and Officers Liability coverage can help address certain claims arising from those decisions. Organizations with employees should also review Employment Practices Liability coverage. Board members should know what protection the organization provides rather than assume their personal insurance will respond.
Employees and volunteers: Volunteers are essential to many nonprofits, but their coverage may differ from an employee’s. It is worth asking how general liability, workers’ compensation and any volunteer or participant accident coverage apply to the work people actually perform.
New or changing programs: Insurance does not automatically adjust when a nonprofit adds an after-school program, begins transporting clients, hosts an overnight trip or opens a facility to another group. A program that began as a small pilot can become a major part of an organization’s work without anyone revisiting its insurance.
Work beyond the main location: Fundraisers, field trips, home visits and community events can bring staff and volunteers into settings quite different from their usual workplace. Leaders should understand how their coverage applies when activities take place away from the organization’s building.
Professional services and safeguarding: Organizations serving children or vulnerable adults, or providing counseling, education or healthcare services, may face risks that require specialized coverage. Insurance is one part of the picature. Background checks, clear procedures and regular training matter as well.
Sensitive information: Even a small nonprofit may hold donor records, employee information, or details about the people it serves. A cyber incident can interrupt services as well as create substantial costs. The question is not simply whether a policy says “cyber,” but what help the organization could call on if an incident occurred.
Buildings and interruptions: A property value carried forward at renewal may no longer reflect the cost of rebuilding. Leaders should also consider how a covered loss that makes a building unusable would affect programs, revenue and ongoing expenses.
The most consequential gap is not always an absent policy. It may be an exclusion, a limit, a deductible, or a condition in a policy the organization has carried for years. Those details are easiest to understand before there is a claim.
A useful review begins with the organization’s work: What services do we provide today? Who do we serve, and where? What do our employees and volunteers do? Have we added a program, vehicle, contract or location? What would interrupt our ability to serve the community?
These are good questions for an executive director and board to ask together, especially before the next renewal. The answers can help them decide which risks to reduce through better procedures, which to insure and where limited dollars will do the most good.
Central Oregon depends on its nonprofits. Taking time to understand what could interrupt their work is one way to help keep their missions moving forward.
