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Business Insurance

Nonprofits, Volunteers and Insurance: How to Understand the Risk

Most non-profits rely to some extent on volunteer work.  It’s part of making the magic of your organization happen.  But there are risks to just about everything we do, and using volunteers is no different. This shouldn’t discourage you from seeking volunteer help, of course – but knowing your risks can help you manage and avoid them when you engage with volunteers. 

 From a definition perspective, individuals who volunteer or donate their services are not considered employees of your organization. But they are considered to be working on the organization’s behalf. If your volunteer makes a mistake, injures someone, or damages property, your organization could be held responsible for the problem.  

 What risks are associated with nonprofit volunteers?  

  • Accidents, injury or death of a client or client’s family member, volunteer, paid staff or member of the general public.
  • Misleading or wrong advice or information that is given to clients or the public
  • Loss or damage to property
  • Theft, misappropriation of funds, fraud
  • Volunteers exceeding job descriptions,  skills boundaries or authority.

 These risks may lead to consequences, such as: 

  • Damage to your organization’s reputation
  • Loss of public trust and support
  • Loss of funding
  • Decreased ability to raise funds or recruit volunteers
  • Termination of insurance or increased costs of premium
  • Defense costs (even if alleged)
  • Injury to the volunteer

How can good nonprofit insurance help?

As far as addressing these risks, insurance may not be the sole answer to every potential issue, but a good policy (or policies) can help reduce your exposure. And just going through the insurance process is extremely useful as a way to thoughtfully consider these risks and address what to do about them.  It’s ideal to work with an insurance advisor who is going to diligently consider the unique elements of your organization, identify the risks – like those mentioned above – that apply to you, and review potential solutions with you.  Not all individual insurance policies cover these risks, but a combination of policies certainly can.  An insurance advisor with deep experience in the nonprofit industry can help you find the right combination of insurance and business policies to keep your organization safe. 

Erwin Insurance Agency® is an independent insurance agency offering a comprehensive suite of business and personal insurance solutions to cover the things that matter to you most. Serving Florida, New York and beyond, with offices in Jacksonville, Fleming Island and New York City. Licensed in 17 states, they include specialized nonprofit insurance among their business insurance lines.