Nonprofits Insurance Alliance

The saying goes, “a picture is worth a thousand words,” but using an image or picture without permission will cost the same, or more, in dollars when you don’t get permission to use it.

For example, a nonprofit was gearing up for an annual fundraising campaign. Everything was ready and all promotional materials had been drafted. But something was missing from the webpage — photographs.

Earlier this month, I was moderating a leadership meeting for the managers at Nonprofits Insurance Alliance. Since the topic of the meeting was about how to have difficult conversations with employees, I opted to start with an icebreaker: I had previously asked participants to take the Open-Source Psychometrics “Which Character” Personality Quiz online and reveal what popular character they best matched up with. The answers were varied, and included characters ranging from Geordi La Forge from “Star Trek” to Nala from “The Lion King,” and a few with Lester Freamon from “The Wire.”

As a nonprofit committed to sustainability and green practices, NIA is pleased to be a source of stable insurance to like-minded organizations that work to protect the environment and fight climate change. That’s why we’re proud to welcome Live Zero Waste as our 24,000^th member!

The article below discusses the serious consequences that have recently developed in California resulting from a court decision that may significantly impact the ability of California nonprofits to conduct in-depth and meaningful background checks of potential employees that may be required by other laws. We don’t provide a conclusive answer because the situation is still in flux, but offer you background and possible considerations.

During the current hard insurance market, defined as a market with increasing insurance rates and decreased availability of coverage, nonprofits are finding that coverage provided by commercial carriers is not consistent, affordable, or appropriate.

Furthermore, nonprofits’ contracts require certain types of coverages and policy limits, such as sexual abuse liability coverage, so when commercial insurance companies no longer offer the coverage policies nonprofits need, it can leave them in violation of contract terms with federal, state, and local municipalities.

The few commercial insurance companies that have provided sexual abuse liability coverage to community-based nonprofit organizations in the past are currently in a fit of angst about the extension of statutes of limitations that grant victims of sexual abuse an expanded window in which to bring their claims into court. This is what’s known as “social inflation” in the insurance industry.

For the past few years, many commercial carriers have opted not to renew existing sexual abuse and molestation coverage for nonprofits — and sometimes the complete package of insurance as well. Most other carriers have been lowering the limits of coverage they will offer and imposing large, self-insured retentions and significant premium increases.

Some insurers have even abandoned the social service market completely, citing the impact of these new laws. Are these actions justified based on evidence of more frequent sexual abuse claims against community-based nonprofits?

The answer is no.

Over the course of the past 10 years, the frequency of sexual abuse claims emanating from community-based nonprofits has not changed, despite changes to the laws providing more opportunity for claims to be brought.