Nonprofits are a powerful force for good in society, and many people choose to support them through volunteering, donating, or working for them.

However, time and again, these influential organizations face many risks and uncertainties that often remain overlooked.

And this overlooking might affect these organizations big time.

From liability claims to cyber-attacks, property damage, and employee injuries, nonprofit organizations consistently become victims of many lawsuits against them.

With plenty at stake, they must protect themselves from these uncertainties at all costs.

But how?

That is where nonprofit insurance comes in.

At Charity One Insurance, we specialize in providing insurance coverage for nonprofit organizations.

We understand the unique challenges and risks nonprofits face, and we work closely with our clients to help them protect their mission and assets.

Today, we’ll discuss these risks and how nonprofit insurance can help mitigate those risks.


Common Risks Faced by Nonprofit Organizations

Nonprofit organizations face various risks that can risk their mission, reputation, and financial stability.

It’s essential for nonprofits to understand these risks and take steps to manage them effectively.

Let’s take a look at some of the most common risks faced by nonprofit organizations:

1.    Theft of Funds

Nonprofits can be targeted for funds theft by internal and external parties. Whether it’s embezzlement by an employee or fraud by an outside party, the loss of funds can devastate a nonprofit’s financial stability.

2.    Fundraising Fraud

Nonprofits rely on fundraising to support their programs and services. However, fundraising fraud can be a significant risk, with scammers impersonating legitimate organizations or individuals to solicit donations.

3.    Reputational Damage

Nonprofits rely on their reputation to attract donors, volunteers, and other stakeholders. Negative publicity or a scandal can severely damage a nonprofit’s reputation, making it difficult to attract support.

4.    Directors’ and Officers’ Liability

Nonprofit board members and officers must act in the organization’s best interests. If they fail to fulfill this duty, they can be held personally liable for damages.

5.    Volunteer Staff

Volunteers are essential to many nonprofit organizations, but they also present risks. Volunteer staff can cause injury or damage or engage in misconduct that can put the nonprofit at risk.

6.    Donor Data Breaches

Nonprofits are responsible for safeguarding donor data, including personal and financial information. A data breach can damage a nonprofit’s reputation and result in legal and economic consequences.

7.    Special Events

Nonprofits often hold special events to raise funds or increase awareness. However, these events can present risks like accidents, injuries, or property damage.

8.    Nonprofit Workers’ Compensation Risks

Nonprofit employees may be exposed to various risks in the workplace, such as physical injuries or illness. Nonprofit workers’ compensation insurance can help protect employees and the organization.

9.    Employment Issues

Nonprofits must comply with employment laws and regulations, including discrimination, harassment, and wage and hour laws. Noncompliance can result in legal and financial consequences.

10.  Regulatory Compliance

Nonprofits must comply with various laws and regulations, including tax-exempt status, fundraising, and reporting. Noncompliance can result in legal and financial consequences.

11.  Sexual Assault

Sexual assault is a significant risk for nonprofit organizations, particularly those that work with vulnerable populations. Nonprofits must take steps to prevent and address sexual assault in their programs and services.

12.  Property

Nonprofits may own or lease property, and these assets can be at risk of damage or loss due to natural disasters, accidents, or vandalism.

13.  Cyber Exposures

Nonprofits must protect their data and IT systems from cyber threats, including hacking, phishing, and malware.

14.  Tax Liabilities

Nonprofits must comply with various tax laws and regulations, including those related to payroll taxes, sales taxes, and unrelated business income taxes.

15.  Tax-Exempt Status

Nonprofits must maintain their tax-exempt status by following the IRS’s rules and regulations. Losing tax-exempt status can have significant financial and reputational consequences for a nonprofit.


Types Of Insurance Coverages That Can Help Nonprofit Organizations

To protect your organization against various claims, nonprofit insurance policies can cover specific risks.

Let’s take a closer look at some of the nonprofit insurance options that are available:

1.    General Liability Insurance

This type of insurance provides coverage for claims related to bodily injury, property damage, and personal and advertising injury. It is designed to protect your organization from the risks associated with daily operations, such as accidents that occur on your premises or as a result of your organization’s activities. With this coverage, your organization could be protected from significant financial losses.

2.    Commercial Property Insurance

This type of insurance covers damage to your organization’s property, including buildings, equipment, and inventory. It can help protect your organization from losses due to theft, vandalism, fire, and other disasters.

3.    Professional Liability Insurance

This type of insurance, also known as errors and omissions insurance, covers claims related to professional services provided by your organization or its employees. It can protect your organization from financial losses from allegations of negligence, errors, or omissions.

4.    Automobile Insurance

If your organization owns or operates vehicles, automobile insurance is essential to protect against accidents, liability claims, and property damage. This type of insurance can also provide coverage for employee-owned vehicles used for organizational purposes.

5.    Directors and Officers Liability Insurance

This type of insurance covers claims made against your organization’s directors and officers for alleged wrongful acts, such as breach of duty, negligence, or mismanagement. Without this coverage, your organization’s leaders could be personally liable for damages.

6.    Workers’ Compensation Insurance

Workers’ compensation insurance is required in most states if your organization has employees. It provides coverage for employees who are injured on the job, including medical expenses and lost wages. This type of coverage can help protect your organization from costly lawsuits resulting from workplace injuries.

Each of these insurance options can play a critical role in protecting your organization from the risks we discussed earlier.

Working with an experienced insurance provider like Charity One Insurance can help you assess your organization’s specific needs and develop a comprehensive insurance strategy is essential.


Choosing The Right Nonprofit Insurance Coverage for Your Organization

Having the right insurance coverage is essential when safeguarding your organization against various claims.

With so many different types of policies available, knowing which one best suits your organization’s needs can be challenging.

Let’s find out how you can find the right one.

1.    Assessing Your Organization’s Risk Profile

The first step in choosing the proper nonprofit insurance coverage is to assess your organization’s risk profile. It involves identifying the potential risks your organization faces and the likelihood of those risks occurring. For example, if your organization operates in an area with high crime rates, you may be at a greater risk of theft or property damage.

2.    Determining Your Insurance Needs

Once you have assessed your organization’s risk profile, the next step is to determine your insurance needs. It involves considering the types of coverage most relevant to your organization and the level of coverage you require. For example, if your organization relies heavily on volunteers, you may need to consider workers’ compensation coverage to protect your volunteers in case of injury.

3.    Comparing Different Policies and Providers

Once you clearly understand your organization’s risk profile and insurance needs, it’s time to start comparing different policies and providers. When comparing policies, be sure to look at the coverage limits, deductibles, and exclusions to ensure that you are getting the coverage you need. It’s also important to consider the financial stability and reputation of the insurance provider.

4.    Finding the Right Price

Of course, cost is always a consideration when choosing nonprofit insurance coverage. It’s essential to find a policy that offers the right level of coverage at an affordable price for your organization. However, it’s also important to remember that the cheapest policy is only sometimes the best option. You don’t want to sacrifice coverage for price, as this could leave your organization vulnerable in case of a claim.

5.    Getting the Right Coverage

Ultimately, the key to choosing the proper nonprofit insurance coverage is to find a policy that provides the range your organization needs at an affordable price. By assessing your organization’s risk profile, determining your insurance needs, and comparing different policies and providers, you can find the right coverage to protect your nonprofit organization.


Risk Management for Nonprofits

To minimize various risks, nonprofits must have a risk management plan.

It involves identifying potential risks, assessing their impact, and implementing mitigation strategies.

What is Risk Management?

Risk management is the process of identifying, assessing, and controlling potential risks to an organization.

In the context of nonprofit organizations, this involves identifying and assessing the various risks that may affect their operations and implementing strategies to minimize the likelihood and impact of those risks.

Why is Risk Management Important?

Effective risk management is crucial for nonprofit organizations for several reasons. First, it helps protect the organization’s assets and financial stability.

It is essential for nonprofits that rely on donations and grants to fund their operations.

A significant risk event, such as a lawsuit or loss of funding, can significantly impact the organization’s ability to fulfill its mission.

Second, effective risk management helps protect the organization’s reputation. A significant risk event, such as a data breach or scandal, can damage the organization’s image and erode public trust.

Some Risk Management Strategies

Nonprofit risk management involves identifying and mitigating the various risks that nonprofit organizations face.

Some of the most common risks include theft of funds, fundraising fraud, reputational damage, directors and officers’ liability, volunteer staff, donor data breaches, special events, nonprofit workers’ compensation risks, employment issues, regulatory compliance, sexual assault, property damage, cyber exposures, tax liabilities, and tax-exempt status.

To manage these risks effectively, nonprofit organizations should consider implementing the following risk management strategies:

  • Funding Theft Prevention: Nonprofits should implement internal controls and oversight procedures to prevent the theft of funds by employees or volunteers.
  • Volunteers: Nonprofits should conduct background checks and implement training programs to reduce the risk of volunteer-related incidents.
  • Cybersecurity: Nonprofits should implement best practices for data security, including regular updates of software and passwords, staff training, and regular data backups.
  • Special Events: Nonprofits should have a risk management plan for any special events, including insurance coverage and safety protocols.
  • Workers’ Compensation: Nonprofits should have appropriate workers’ compensation coverage to protect their employees in case of injury.

By implementing these risk management strategies, nonprofit organizations can protect their assets, reputation, and mission. It’s also essential to regularly assess and update the organization’s risk management plan to ensure it remains effective in changing circumstances.



Managing risks is critical for nonprofit organizations, as it can help prevent financial loss, reputational damage, and legal issues.

By understanding the risks they face and taking steps to mitigate them, nonprofits can focus on their mission and achieve their goals.

With the right nonprofit insurance coverage and risk management strategies, organizations can safeguard their assets and continue to impact their communities positively.

So, nonprofits must invest in risk management and insurance solutions that suit their needs and provide them with the necessary protection.

By doing so, they can be better prepared to face any challenges that come their way and achieve their long-term goals.



What is nonprofit insurance?

Nonprofit insurance is a type of insurance coverage designed specifically for nonprofit organizations. It helps protect these organizations against risks such as theft, fundraising fraud, reputational damage, and employment issues.

What types of nonprofit insurance are available?

Some of the most common types of nonprofit insurance include general liability, commercial property, professional liability, automobile, directors and officers liability, and workers’ compensation.

Why do nonprofit organizations need insurance?

Nonprofit organizations face various risks that can have severe financial and reputational consequences. Insurance can help these organizations manage these risks and protect themselves against potential losses.

How can nonprofit organizations choose the right insurance coverage?

Nonprofit organizations should assess risk profiles, determine insurance needs, and compare policies and providers. Choosing coverage that adequately addresses the organization’s specific risks and exposures is essential.

What is risk management?

Risk management involves identifying, assessing, and prioritizing risks and developing strategies to mitigate or manage those risks. In the context of nonprofit organizations, risk management can help protect the organization’s mission and financial stability.

What are some examples of risk management strategies for nonprofit organizations?

Nonprofit organizations can develop a risk management plan, conduct regular risk assessments, implement best practices for data security and cybersecurity, provide training for volunteers and employees, and have a crisis communication plan. These strategies can help the organization identify and manage risks effectively.

Nonprofit organizations play an essential role in our society, addressing social issues and providing vital services to communities.

However, just like any other business, nonprofit organizations face various risks and potential liabilities that can threaten their operations.

That’s why it’s essential for nonprofits to protect themselves with the right insurance coverage.

Nonprofit organizations need insurance to protect themselves against risks and potential liabilities that can affect their financial stability and daily operations.

That said, let’s explore what common risks are faced by nonprofit organizations and how insurance can help them fight against these risks.


Common Risks and Claims Faced by Nonprofit Organizations

Nonprofit organizations face various risks that can impact their operations and financial stability. Because of these risks, they may face claims and lawsuits from various sources.

But what are these claims?

To answer, here are some of the most common types of claims that can be brought against nonprofits:

1.    Contractual Disputes

Nonprofits may be involved in various contractual arrangements, such as leases, vendor agreements, and service contracts. If one party fails to meet their obligations under the contract, it can result in a contractual dispute.

2.    Personal Injuries

Nonprofits that provide services or host events may be liable for injuries sustained by clients, volunteers, or members of the public. It can include slip and fall accidents, injuries from equipment or activities, and other types of accidents.

3.    Dissatisfied Donors

Nonprofits rely on donations from supporters to fund their operations. If a donor is dissatisfied with how their donation was used or believes that the nonprofit acted improperly, they may bring a lawsuit against the organization.

4.    Employment Practices

Nonprofits with employees are subject to a range of employment laws and regulations. If an employee believes that their rights were violated, they may file a claim against the nonprofit.

5.    Financial Reporting

Nonprofits are required to maintain accurate financial records and to file annual tax returns. If there are discrepancies or errors in the financial statements, it can lead to legal and financial repercussions.

6.    Defamation

A claim can be brought against a nonprofit organization if it defames an individual or another organization. Defamation can occur through written or spoken words that harm the reputation of the individual or organization.

7.    Discrimination

Nonprofits can be sued for discrimination based on age, race, gender, religion, disability, or any other protected category. It includes discrimination in hiring, promotion, and treatment of employees or volunteers.

8.    Harassment

A nonprofit can be sued for harassment if an employee or volunteer creates a hostile work environment for others. It can include verbal or physical abuse, sexual harassment, or any other behavior that creates a hostile work environment.

9.    Negligence

Nonprofits can be sued for negligence if they fail to take reasonable care to prevent harm to others. It can include failing to maintain safe premises, provide adequate training, or adequately supervise employees or volunteers.

10.  Sexual misconduct

A nonprofit can be sued for sexual misconduct if an employee or volunteer engages in sexual activity with a client or donor or engages in any other inappropriate sexual behavior.

11.  Property damage

A nonprofit can be sued for property damage if it damages someone else’s property while carrying out its activities.


What Kinds of Nonprofit Claims Are Prevalent?

While all nonprofits face risks, some types of claims are more common than others. Here are some of them:

1.    Employment Practices Claims

Employment practice claims, such as wrongful termination or discrimination, are becoming increasingly common. These types of claims can result in significant legal expenses and damage to the nonprofit’s reputation.

2.    Property Damage Claims

Property damage claims can occur for various reasons, such as natural disasters or accidents. Nonprofit organizations that own or lease property should ensure adequate insurance coverage to protect against property damage claims.

3.    Liability Claims

Liability claims can result from a wide range of incidents, such as slips and fall on the nonprofit’s premises or accidents involving nonprofit-owned vehicles. Liability claims can be particularly costly, making it essential for nonprofit organizations to have appropriate liability insurance coverage.

4.    Cyber Liability Claims

Cyber liability claims can result from data breaches, cyber-attacks, and other cyber-related incidents. With the increasing reliance on technology today, nonprofits are particularly vulnerable to cyber risks and should consider cyber liability insurance.

5.    Director and Officer (D&O) Claims

D&O claims can result from alleged misconduct or errors in judgment by nonprofit directors or officers. These types of claims can result in significant legal expenses and should be taken seriously by nonprofit organizations.


Why Nonprofits Need Insurance Coverage and Why it is Important?

Due to the variety of risks faced by nonprofit organizations, it is imminent that they might suffer significant financial losses and reputational damage at a given point in time.

For example, property damage from natural disasters or accidents, employee injuries, and liability claims resulting from alleged wrongful acts by directors, officers, and staff can all have severe consequences for an organization.

Insurance coverage can help protect nonprofit organizations against these risks and provide a safety net in case something goes wrong.

Here are some of the top reasons why nonprofit organizations need insurance coverage to stay protected:

1.    Protects Against Liability Claims

Insurance coverage can help protect nonprofit organizations against liability claims that arise from allegations of wrongdoing or negligence by directors, officers, or staff. It can include claims of discrimination, harassment, wrongful termination, and other employment-related issues.

2.    Covers Property Damage

Nonprofit organizations may own or rent buildings, equipment, and other assets that are critical to their operations. Insurance coverage can help cover the costs of repairing or replacing these assets in case of damage or loss.

3.    Ensures Business Continuity

Disruptions to operations, such as damage to property or loss of key personnel, can have significant financial and reputational impacts on nonprofit organizations. Insurance coverage ensures that organizations can continue their operations in the event of an unexpected event.

4.    Builds Credibility

Having insurance coverage can help nonprofit organizations build credibility with donors, volunteers, and other stakeholders. It shows that the organization is prepared and taking steps to protect itself and those it serves.


What Types of Insurance Coverage Does a Nonprofit Need?

There are a variety of insurance coverages out there. However, all of them are not meant for a nonprofit organization.

So, which ones should a nonprofit go for?

Here are some insurance coverages that nonprofit organizations may need to consider to protect themselves against potential risks.

1.    General Liability Insurance

This policy protects against third-party claims for bodily injury, property damage, and personal injury, such as slander or defamation. This policy is essential for any nonprofit organization that interacts with the public.

2.    Professional Liability Insurance

This policy provides protection for professionals, such as lawyers, accountants, or consultants, against claims of negligence or errors in their professional services.

3.    Property Insurance

This policy provides coverage for damage to the property owned or leased by the nonprofit organization. It includes protection for buildings, equipment, and other assets.

4.    Auto Insurance

Nonprofits that use vehicles for their operations, such as transporting volunteers or delivering goods, should consider obtaining auto insurance to protect against vehicle accidents or damage.

5.    Workers’ Compensation Insurance

Nonprofits that have employees should consider obtaining workers’ compensation insurance, which provides benefits to employees who are injured or become ill as a result of their job.

6.    Directors and Officers Liability Insurance

This policy provides protection for the directors and officers of the nonprofit organization against claims of wrongful acts or decisions that result in financial damages to the organization.

7.    Crime Coverage Insurance

This policy provides coverage for losses resulting from criminal acts such as theft, fraud, or embezzlement.

8.    Cyber Liability Insurance

Nonprofit organizations that collect and store sensitive data should consider obtaining cyber liability insurance to protect against data breaches and cyber-attacks.

9.    Employment Practices Liability Insurance (EPLI)

This policy protects against discrimination, harassment, wrongful termination, and other employment-related claims.

10.  Health Insurance

Nonprofit organizations may offer health insurance to their employees as a benefit, which can attract and retain top talent.

11.  COBRA and Continuing Coverage for Health Insurance

Nonprofits that offer health insurance must comply with COBRA regulations, which allow employees to continue their health insurance coverage after leaving the organization.

12.  Fidelity Bond Insurance

This policy provides coverage for losses resulting from employee dishonesty, such as theft or embezzlement.

13.  Fiduciary Insurance

This policy provides protection for the fiduciaries of the organization against claims of breach of fiduciary duty.

14.  Business Owners Policy (BOP)

This policy provides a package of insurance coverages, including property, liability, and business interruption insurance, which can be tailored to the specific needs of the nonprofit organization.

15.  Umbrella or Excess Liability Policy

This policy provides additional coverage beyond the limits of the primary liability policies.

16.  Premises Liability Insurance

This policy provides coverage for bodily injury or property damage that occurs on the premises of the nonprofit organization.

17.  Product Liability Insurance

Nonprofits that manufacture or distribute products should consider obtaining product liability insurance to protect against claims of injury or damage resulting from the use of their products.

18.  Sexual Misconduct Liability Insurance

This policy provides protection against claims of sexual misconduct or abuse by employees, volunteers, or other individuals associated with the nonprofit organization.

By obtaining the appropriate insurance coverage, nonprofit organizations can protect themselves against potential risks and liabilities and ensure they can continue fulfilling their mission without worrying about unexpected financial losses.


Factors Nonprofits Should Consider While Choosing an Insurance

When choosing insurance coverage for a nonprofit organization, several essential factors must be considered.

These factors can help organizations make informed decisions about the type of coverage they need to protect themselves against potential risks and liabilities.

1.    Size of the Organization

The nonprofit organization’s size is an important consideration when choosing insurance coverage. Larger organizations may require more comprehensive coverage, while smaller organizations may be able to get by with basic coverage options.

2.    Type of Activities

The type of activities that the nonprofit engages in is another essential factor to consider. For example, an organization that holds events or works with volunteers may require additional coverage options to protect against liability claims.

3.    Budget

Budget is also a significant factor to consider when choosing insurance coverage. Nonprofit organizations must balance their insurance needs against their budget limitations and should carefully consider the cost of premiums and deductibles when selecting coverage options.

4.    Experience with Claims

It is essential to work with an insurance company with experience with nonprofit organizations and can provide guidance on the specific risks they face. The insurance company should also have a proven track record of handling claims effectively and efficiently.

Your Nonprofit Organization Updates

Nonprofit organizations are constantly evolving, and working with an insurance company that can adapt to these changes is essential. The insurance company should be able to provide coverage options that reflect the organization’s current activities and plans.


What Are the Benefits of Using an Insurance Agency?

Nonprofit organizations have many options when it comes to purchasing insurance coverage.

One option is to work with an insurance agency, which can provide several benefits.

Here are some of the critical advantages of using an insurance agency:

1.    They provide you with options for convenient shopping

Insurance agencies work with a variety of insurance companies and can provide you with multiple options to choose from. It can save you time and hassle, as you don’t have to shop around with different insurance companies on your own.

2.    They provide knowledge and support

Insurance agencies have a wealth of knowledge and experience in the insurance industry. They can help you understand the different types of coverage available and recommend policies that are best suited to your nonprofit’s unique needs. They can also provide ongoing support and advice, such as helping you manage your insurance policies and file claims.

3.    Customized service

An insurance agency can provide a customized insurance plan tailored to your nonprofit’s specific needs. They can work with you to identify your organization’s risks and liabilities and create a comprehensive insurance plan that addresses those risks.

4.    Suitable for complex insurance needs

An insurance agency can be especially beneficial for larger nonprofit organizations or those with more complex insurance needs. They have the expertise to navigate the intricacies of complex insurance policies, ensuring that your organization has the right coverage in place to protect against potential risks and liabilities.


What’s Next?

As a nonprofit organization, protecting yourself against potential risks and liabilities is crucial.

Insurance coverage is an essential tool that can help you achieve this goal. Having the right insurance policies can safeguard your organization’s financial stability and protect your employees, volunteers, and beneficiaries.

The types of insurance policies that your nonprofit may require depend on several factors, such as size, activities, and budget.

However, with the guidance of an experienced insurance agency, you can find coverage that suits your specific needs.

With their expertise, knowledge, and support, you can make an informed decision and secure the best protection for your organization.

Don’t wait until it’s too late.

Act now and take the necessary steps to protect your nonprofit organization with insurance coverage.



Why do nonprofit organizations need insurance?

Nonprofit organizations face various risks, such as property damage, liability claims, and employee injury. Insurance coverage helps protect against these risks and potential liabilities they may face.

What types of insurance policies do nonprofit organizations need?

Nonprofit organizations may need a variety of insurance policies such as general liability, professional liability, property insurance, auto insurance, workers’ compensation, directors and officers liability, cyber liability, and employment practices liability insurance (EPLI), among others.

Can’t nonprofit organizations rely on volunteers and good intentions to protect them from liability?

While volunteers and good intentions are valuable, more is needed to protect a nonprofit organization from potential liabilities. Insurance coverage provides a safety net in case something goes wrong.

Is insurance coverage expensive for nonprofit organizations?

Insurance coverage costs may vary depending on the size and type of the nonprofit organization, the activities it performs, and the level of coverage needed. However, insurance is an important investment that can protect a nonprofit organization from potentially devastating financial losses.

Can nonprofit organizations purchase insurance coverage for specific events or activities?

Yes, nonprofit organizations can purchase insurance coverage for specific events or activities, such as fundraising events, concerts, or athletic activities. This type of coverage is typically referred to as special event insurance.

What factors go into purchasing insurance for nonprofit organizations?

Nonprofit organizations should consider factors such as the size and scope of their operations, the types of risks they face, and their budget when purchasing insurance. Other factors may include the number of employees, the types of programs and services offered, and the organization’s assets and property.

Do I need an insurance agent to purchase an insurance?

While it is possible for nonprofit organizations to purchase insurance directly from an insurance company, working with an experienced insurance agency can provide valuable guidance and support. An insurance agency can help identify the specific risks that a nonprofit organization faces and recommend insurance coverage options that best meet its needs and budget. Additionally, an insurance agency can help manage claims and provide ongoing support throughout the insurance purchasing process.


Governor Newsom signed SB 1159 on September 17, 2020 that created new laws that significantly affect California employers who have employees who test positive for COVID-19.

One of these, Labor Code Section 3212.88 applies to California employers who have 5 or more employees. The law says if a COVID-19 outbreak takes place at a place of employment it is assumed employees who test positive for COIVD-19 contracted it at work.

This law creates new reporting obligations for employers.  Employers are now required to report to their claims administrator via email or fax, when the employer is aware that an employee tested positive for COVID-19.  The report must be made within 3 business days.

Employers are required to report:

-Notice that an employee has tested positive.  Not to include any Personal Identifiable Information (such as SSN, DOB, etc.).

-The date the specimen was collected for the positive test.

-Positive PCR COVID-19 test or other FDA approved viral test. Serologic (antibody) testing is not a viable test.

-All locations where employee worked at your direction during the 14-day period prior to the positive test result.

-The highest number of employees who worked at the employee’s specific work location(s) in the 45-day period preceding the last day that the employee worked there.

-If an employer is aware of an employee who tested positive prior to the effective date of this statute, between July 6, 2020 and September 16, 2020 they have until October 29, 2020 to report those cases to their claims administrator. The employer reporting requirements are the same as above for items 1 through 3, however the data under 4 should indicate the highest number of employees who reported to each specific work location during the period of between July 6, 2020 and September 17, 2020.

Failing to submit this information or providing false or misleading information can result in an employer being assessed with a $10,000 civil penalty and/or a citation.

An outbreak occurs if, within a 14-day calendar period, one of the following happens:

-Employers with 100 employees or less at a specific work location and 4 or more employees test positive at that specific location; or

-Employers with more than 100 employees at a specific work location and at least 4% of employees test positive at that specific location; or

-A specific place of business is closed by local public health department, State Department of Public Health or school superintendent due to risk of infection with COVID-19.

-A “specific work location” means the building, store, facility or agricultural field where the employee worked at your direction.  Many workers may transition between multiple places of employment during their shift. So tracking the locations that they are required to work at is essential.

In addition, the employee must:

-Have worked on or after 7/6/2020; and

-Have worked outside their home or residence at the employer’s direction; or worked to provide home health care services to another individual at their home or residence; and

-Have a positive PCR COVID-19 test or other FDA approved viral test (does not include serologic (antibody) test) within 14 days after performing the labor or services; and

-The positive COVID-19 test must have occurred during a period of outbreak at the employee’s specific place of employment.

Claims administrators are tasked with using the reported information to calculate whether an outbreak has occurred.  So providing timely, detailed reporting is critical.

Additionally, if a claim becomes accepted under this section an employee is required to exhaust any paid sick leave benefits specifically available in response to COVID-19 before temporary disability benefits may be paid.

This information was derived from the State Compensation Insurance Fund Website but applies to all California employers regardless of their insurance company.

For more information or to file a claim, please contact our office at 626-815-1550.




According to their website, GuideStar gathers, organizes, and distributes information about nonprofits in the United States. They gather data from various public sources and aggregate the data into GuideStar Nonprofit Profiles, one profile for each organization in the database. Each nonprofit is encouraged to update their profile on the website, which is available free of charge. 


GuideStar is a powerful tool, last year more than 9 million people visited the website and millions more utilized the data through third party sites. With a virtual footprint so powerful, it is important to harness that power to the advantage of your organization. That is why we took some time to explain how GuideStar can help your organization. 


Free Marketing and Exposure to Clients and Donors 

Updating your profile on GuideStar costs nothing. Profiles are automatically created for 501(c)3 organizations who have filed as tax exempt with the IRS. The reach GuideStar has to the public is massive. Their data is used by more than 200 websites and applications including, Facebook, Network for Good, AmazonSmile, and JustGive. Updating your profile on GuideStar will ensure that YOUR message is told and data the public sees is accurate. 

Fundraisers and donations can be accepted on GuideStar directly on your profile as well. This is another fundraising avenue that can be used for either a robust fundraising campaign or used passively. 

In addition to directly raising funds, it is important to note that foundations and donors are using GuideStar data to make their decisions. 


Boosts Trustworthiness and Transparency

GuideStar promotes transparency and allows Nonprofits to share information about their organization. They have a “Seal” system with badge levels ranging from Bronze, Silver, Gold and Platinum. These levels are determined by the level of data that is provided about your organization on GuideStar. The Bronze level shares basic information so that your organization can be found. The highest level, Platinum, shares your progress and results so you can show the difference that your organization is making. 

Once you reach these transparency levels, GuideStar will provide your organization with a seal of transparency badge. This image file can be downloaded from GuideStar, they even offer a widget that can be installed onto your website and linked directly to your GuideStar profile. 


If your organization has not yet updated your profile, please visit GuideStar’s Help Center for instructions on how to create and update your account. View your existing profile on using the search function to find your organization.

The outbreak of COVID-19 acute respiratory disease may cause a significant economic impact for Nonprofit & Social Service Organizations. Numerous cities across America have closed popular gathering places including sports facilities, schools, theaters, museums and other venues to limit the spread of the virus. Business closures and lost sales has lead to inquiries regarding business interruption coverage under property insurance policies. We have complied information from our partner insurance carriers to shed light on how Business Interruption/Business Income applies to these inquires.
Coverage Trigger
The trigger for any property insurance policy is physical damage to insured property by an insured peril. Insurance carriers are likely to argue that the introduction of a virus does not constitute direct physical loss or damage to insured property. Many policies may also contain a contamination exclusion which includes virus, disease or illness causing agent in the definition of contaminant. Most policies do not cover a loss resulting from a virus.
Another coverage that has been put into question is Workers Compensation. The answer depends on the facts established during an investigation and the laws. Generally, for such a disease such as Coronavirus to trigger coverage, the illness or disease must be occupational, meaning that it arose out of and was in the course and scope of employment and the illness or disease must arise out of or be caused by conditions peculiar to the work.
It is important to note that every situation is unique. If you feel that your organization has a covered claim, you are encouraged to file a claim report.
We cannot answer questions about what may or may not be covered in hypothetical situations however we are available to consult with you to the best of our abilities at this time.

Charity One Insurance Agency is proud to launch our new insurance program specifically designed for Residential Care Facilities! After over 19 years of providing insurance coverage to Nonprofit & Social Service Organizations, we are proud to have a program focused on Residential Care. 

Our program focuses on providing coverage to the following homes:

– Group Homes for Children

– Senior Housing

– Transitional Living

– Halfway Houses

– Adult Residential Care Facilities

– Homeless Shelters

– Assisted Living

– Shelters

– Recovery Homes 


What kind of insurance coverage does a Residential Care Facility Need? 

If your organization is contracted to receive residents from a Government Entity or other Organization, they may impose insurance requirements. Please review your contract to determine the coverage that is required to accept clients. 

At the same time, it is important to keep in mind that insurance requirements mandated by contract may not cover all of your exposures. Please review the following list of minimum requirements we recommend for Residential Care Facilities:

General Liability

Professional Liability

Abuse & Molestation

Directors & Officers

Employment Practices Liability 

Workers Compensation

Hired and Non Owned Auto

Business Personal Property


Are Residential Care Facilities Required to Carry Workers Compensation?

Please refer to your Contract Insurance Requirements to determine if Workers Comp is required. California State Law requires employers to carry Workers Compensation upon hiring their first employee. Harsh penalties will be imposed by the state if a Worker is injured and the business did not have a Workers Comp policy to cover their on the job injury. 


What type of risk is associated with Residential Care Facility operations?

Resident neglect. Abuse & molestation between residents or staff. Accidents while transporting clients. Theft of property. Slip and fall. General negligence. Liability on the board of directors for decisions that they made while serving. Claims surrounding hiring and firing staff. Harassment and wrongful termination of staff. Liability of volunteers or employees driving their own vehicle on behalf of the business. Injuries to staff or residents while transporting. Fire damage. Theft of money and securities. Speak with an agent to determine the best risk mitigation plan for your residential care facility. 


Can I combine all of my residential care facilities into one insurance policy?

Depending on the organizational structure you may be able to combine all homes onto one insurance policy. If the ownership is the same throughout all facilities then combining all homes onto one policy will be simple. If the ownership varies please speak with an agent about your options. 


How long does it take to obtain a certificate of insurance? 

The quoting process takes an average of 5 days to obtain options with all of the required information provided. Rush quotes can be obtained if needed. Once the organization has selected a quote option, provided payment and all bind conditions then a certificate of insurance will be released within 24-48 hours. 

If you require Additional Insureds on your policy, please let your agent know as soon as possible as this could affect pricing and turn-around time. Providing the insurance portion of your contract will also help your insurance agent quote the required coverage, issue the certificate correctly and minimize errors. 


What information is required to obtain a quote for my residential care facility? 

We can obtain quotes with minimal information obtained during a 15 minute phone call. The insurance company will rate the organization based on a number of factors including:

-Location Address

-Number and Type of Residents

-Number of Employees

-Annual Operating Budget


-Number of Years in Business

-Owner/Operators Experience 

-Claims History

-Building and Property Values/Information

-Vehicles Information

Please be prepared to share details regarding the business operations to properly underwrite and protect your organization. 


How do I select the best insurance company for my residential care facility?

The best place to start is to find an Insurance Agent or Brokerage Firm that you can trust. It helps to find a Company that specializes in insuring your operations. The reason this is important is because a specialized Agent will have access to multiple insurance companies that provide products for your type of operation. Each insurance company will have a different “appetite” or business types that they prefer to work with. Each insurance Agent will work with a different group of insurance carriers. It is in the clients best interest to have quote options from multiple insurance carriers to ensure they are receiving the best products, price and service. 

Once you have multiple quotes from various insurance carriers, you can select the lowest quote but be sure to review the terms and conditions, including the following items:

-Insurance Coverages Included

-Limits of Insurance (also check sublimits which can narrow down coverage)

-Deductibles (also known as retention) 

-Coverage Type (Claims Made vs. Occurrence Form) 

-Retro Date/Full Prior Acts (if moving a claims made policy)

-Quote Conditions


-Definition of a Claim 

-Defense inside/outside of the limit

-Rating Details (locations covered and rating factors used) 

-Risk Management Services/Additional Product Benefits

Reviewing quotes simply based on price may leave you with limited coverage or missing out on access to free or low-cost risk management products that other carriers offer. Speak with a licensed professional to review your options in depth. 

Charity One Insurance Agency specializes in insurance for all types of Residential Care Facilities. Contact our office for a free consultation today!


Full coverage is a misleading term. Making the assumption that you have full coverage in any sense can lead to uncovered claims and losses. We always recommend discussing your coverage concerns with a knowledgeable broker or agent to find out what type of coverage gaps exist and develop a plan to close those gaps. 

A Nonprofit Organization contacted our office to inquire about a potential Auto Insurance coverage gap and needed assistance finding a product that would close the gap. This organization employs Social Workers that go into the field to visit clients and occasionally transport clients. The organization does not own any vehicles and carriers Hired and Non Owned Auto Insurance. 

They require their employees to carry their own Auto Insurance HOWEVER if an employee were to get into an accident, the employees personal auto insurance could potentially decline the claim due to the fact that the employee was using their vehicle for business purposes. 

The organization was under the assumption that the Hired and Non Owned auto would extend coverage to repair the employees car if it was damaged. They even obtained Hired Auto Physical Damage in an attempt to close the gap. Unfortunately, Hired Auto Physical Damage is intended to cover vehicles rented by the organization on a temporary basis. If the vehicle you rent is damaged then the rental car company could bill you for the “loss of use” and the repair or replacement costs due to the damage that was caused. Hired Auto Physical Damage will cover those costs. 


Ultimately it is the responsibility of the employee to obtain the correct coverage for their lifestyle. The staff member should work with their insurance agent to write a policy that will extend coverage while using their vehicle for their job. Some companies will extend coverage, others will exclude coverage for business use. The team member may have to obtain a Commercial Auto policy if their vehicle is used extensively for visits and client transportation. 

Best practice would be to alert your team of this coverage gap and provide them with the tools to protect themselves. It should be clear that the employee is responsible for their own vehicle repairs if their car is damaged. This can be addressed in a company wide memo or added to your employee manual/employment agreement. 

A running list of solutions and precautions has been developed to address this concern:  

Send a Memo/Advise Staff – clearly explain to the team that they must properly insure themselves.

  1. Set Up a Fund – some organizations have set up an emergency fund to assist employees with vehicle repairs that were not covered by insurance. 
  2. Company Cars – if it is in the organization’s budget to purchase a vehicle, this is a great solution. 
  3. Employees Buy a Commercial Policy – carriers can not decline claim for business use.
  4. Employees ask Personal Lines Carrier to Extend Coverage  – some personal carriers will extend coverage for business use. 
  5. Increase the mileage reimbursement to cover the increased insurance costs – help staff cover the additional cost of insurance by increasing mileage reimbursement. 

Explaining to a team member that the organization does not provide coverage for their car after it is in a wreck can lead to an upset team. Proactive insurance talks are an informative way to show your team that you care.

For more information about how to protect your Nonprofit or Social Service Organization from Non Owned Auto Physical Damage claims, contact our office at 626-815-1550.

Over the years we have seen an increase in employee related claims and disputes. There is only 1 insurance product that will provide the coverage that you need when an employee dispute arises, Employment Practices Liability.

Employment Practices Liability, also known as “EPL”, is a coverage generally purchased with Directors & Officers Liability. It is rated on the organizations annual budget, payroll and number of employees. The organizations type of business and employee turn over are also important rating factors.

This coverage will defend the organization from employee disputes such as Wrongful Termination, Harassment, Discrimination and other common claims. The policy is very dynamic and can have any of the following:

-Claims Made/Retro Date

-Defense Inside or Outside of the Limit

-Duty to Defend

-Deductible Options

Like Workers Compensation, there are attorneys willing to draw-up lawsuits against your business on a contingency basis. This means that your current or former employee can sue your organization without spending a dime and the attorney will make a percentage of the settlement earned from the insurance company. Without this coverage the organization will be subject to defend themselves out of their own pocket or be forced to draw from the organizations operating budget!

Obtaining a quote is simple, just call our office and we will work with you to obtain quote options. If you currently have coverage in force, we have multiple markets and can provide you with quotes to compare. Don’t go another day without this coverage in place because in today’s litigious society, the question isn’t if you will get a claim, the question is when

Workers Compensation can be a confusing policy to purchase. Completing a Workers Compensation Audit can be frustrating. Don’t allow this policy to be a source of annoyance, allow our office to analyze your insurance policy for discrepancies to avoid problems during your next Audit. The following is a snap shot of items to be mindful of when writing your policy:
-Incorrect payroll projections can be detrimental. The best advice that can be given is to take the time to report accurate figures and class codes at the inception of the policy. If mid-term hiring or staff reductions create a significant impact in your reported payroll then please contact our office to update your insurance immediately. Insurance carriers will allow you to make adjustments at any time. Adjust your monthly payment based on updated figures or put away funds so you can start budgeting for the additional premium you may be responsible for once the audit is conducted at the end of the policy term.
-You must make sure each employee is classified correctly. If not, you could be paying more than you should be. Or in another worse instance, you may be paying less and when your Workers Comp Audit comes around at the end of the policy term, you will find yourself getting hit with a costly bill you were not expecting due to misclassification. Contact our office to review staff job duties and ensure everyone is classified correctly. Class codes can not be added at the time of Audit or afterwards, so please address this matter prior to binding or as soon as possible.
-Use Independent Contractors with Caution. Most insurance carriers will add payroll for uninsured independent contractors to your policy at Audit. Merely agreeing with someone on an independent contractor status does not make it so. In addition to having a contract in place, the contractor should carry their own Workers Compensation policy. In absence of a policy, there are other factors that the insurance company will use to determine if an employee is truly Independent. Please contact our office before your Audit to ensure your policy is rated correctly.
-Be Aware of the Exclusion Requirements for your Organization. Each corporate structure has their own set of exclusion requirements. Contact our office to see if your company’s Owners and Officers are eligible for exclusion. Only owners that are excluded on a Named Exclusion Endorsement are excluded on the policy. In absence of an endorsement, the insurance company will charge premium for paid owners and officers.
-Owners & Officers are Subject to Minimum/Maximum Payrolls. Compensated Owners, Board Members and Officers are subject to a Minimum and/or Maximum payroll rating. If a compensated Officer has a payroll of only $1,000, they are subject to being rated at a current minimum of $52,000. If a compensated Officer receives $150,000 payroll then they are subject to being rated at the current maximum of $133,900. Please consider this when reporting payroll. Contact our office if you have any compensated Owners & Officers to determine if your payrolls are reported correctly.
Don’t let audit season get you down! Reporting and estimating accurately will save you the headache of additional premium bills. As always, we invite you to contact our office for a policy review at any time!

A common property insurance mis-conception is that you as a policy holder can determine the limit in which you WANT to insure your building or contents. Many people look around their office and say, “if the place burned down, I’d only want to cover the computers and electronics… those would be roughly $5,000… let’s put $5,000 as my property limit to keep the cost down.”. That is not the way that property insurance works in most cases.

Insurance companies require for you to insure up to a percentage of the value of all of the property and contents. The most common co-insurances are between 80%-100%. The lower the co-insurance the better, you will have a higher margin of error and incur a lower penalty if you undervalue your property.

For example, a building with a value of $100,000 and a policy with a coinsurance of 80% must be insured for $80,000. If the insured amount is found to be under the coinsurance percentage at the time of a loss, then a penalty is applied which will reduce the amount of the claim payment. This situation could be detrimental when it comes to replacing or repairing your property.

Calculating the Penalty

The penalty percentage is calculated by the amount that the building was underinsured. Let’s review an example with the following values:

Building Replacement Cost Value: $100,000

Building Insured Value: $60,000

Value of Property Damage Claim: $20,000

Policy Co-Insurance: 80%

For this example, if an organization owns a building $100,000 building, the least they could insure it for is $80,000. However in this example the building was insured for $60,000. Then a property claim occurred which resulted in $20,000 of damage.

To calculate the penalty factor the insurance company will divide the limit on the policy ($60,000) by the limit the building should have been valued at ($80,000). For this example the difference is 75%.  This amount is then multiplied by the amount of the loss as follows:

$20,000 x .75 = $15,000

The policy holder will receive $15,000 (less the deductible) for the $20,000 claim. These numbers become more alarming as the margins increase.

Coinsurance will never overpay on a claim. It will only reduce the payment or have no impact at all. Ask your insurance broker what your co-insurance is and how to reduce or eliminate it. Charity One Insurance Agency has insurance consultants standing by to answer your nonprofit insurance and social service insurance concerns. Call us at 626-815-1550.