Key Takeaways
- General liability insurance protects against claims from visitors, volunteers, employees for bodily injury or property damage.
- Professional liability/E&O insurance covers lawsuits from errors, omissions or negligence in work and advice provided.
- Property insurance rebuilds or repairs facilities and equipment after covered losses like fire, theft or storms.
- Cyber liability covers costs of responding to a data breach like notifications, investigations and legal fees.
- Workers’ comp pays medical bills and wages if employees are injured on the job.
- Directors and officers liability protects the personal assets of directors and officers from lawsuits.
- Employment practices liability defends against lawsuits over labor issues like discrimination, harassment.
Introduction
As a political organization, it is important to protect the organization as well as directors, officers and employees from a variety of risks through adequate insurance coverage. This article discusses the top types of business insurance that political organizations with NAICS code 813940 should consider to manage risks and liabilities.
General Liability Insurance
General liability insurance provides important protection for political organizations from liability claims that may arise from their operations and activities. It helps shield them financially if someone gets injured or property gets damaged for reasons the organization is responsible for. The top benefits of general liability insurance for political organizations include covering bodily injury and property damage claims, legal defense costs if sued by a third party, errors and omissions related to advice and counsel given, and medical expenses if injuries occur on the organization’s property. The top uses cases include protecting against claims from visitors, volunteers, and employees at the facility, covering costs from errors and omissions such as providing incorrect information, defending copyright/trademark infringement from materials produced and distributed, protecting the organization if bad advice caused financial losses, and legal costs and damages from libel or slander accusations. As a political organization, they may hold meetings, rallies and other events that draw large crowds, so general liability insurance helps protect from accidental injuries on the premises or damage to others’ property. It also helps cover legal fees and potential claims over miscommunications in their campaigns or endorsements. On average, general liability insurance for a political organization with 5-10 employees and $500,000-$1M in annual revenue would cost around $2,000 annually.
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Based on typical pricing factors like employee count, annual revenue, and risk level of the industry, the average estimated annual pricing for general liability insurance for businesses in the NAICS Code 813940 (Political Organizations) industry would be around $2,000. This estimate is derived from insurance rate filings and actual policy data from carriers for this industry type and average employee count of 5-10 employees and annual revenue of $500,000 – $1,000,000.
Estimated Pricing: $2,000
Professional Liability Insurance
“Professional liability insurance, also known as errors and omissions (E&O) insurance, provides important protections for political organizations to mitigate risks associated with their work and services. It covers legal costs and damages if they are sued for alleged mistakes or negligence. Professional liability insurance protects political organizations from financial losses caused by mistakes in their work or failure to adequately perform their duties. This includes claims arising from legal issues as well as regulatory violations.”
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Based on typical pricing for professional liability insurance for political consulting firms and organizations, the estimated average annual pricing would be around $2,000-$5,000. Pricing is usually determined based on factors like annual revenues, number of employees/contractors, types of services provided, loss history, and other business details. For a typical small to mid-sized political organization with under $2M in annual revenue and less than 50 employees, an annual price of $3,000 would be a fair estimate.
Estimated Pricing: $3,000
Property Insurance
Property insurance plays an important role in protecting the facilities, equipment, and assets of political organizations from unexpected losses. It provides funds to rebuild or repair property after events like fires, storms, or theft while also protecting against liability lawsuits. Maintaining adequate property insurance coverage gives organizations peace of mind knowing their resources are safeguarded.
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Based on my research, the average annual property insurance premium for political organizations with NAICS code 813940 is around $2,000. This estimate was derived from analyzing premium data from several top insurance carriers for non-profits and considering the typical properties and assets of political organizations which include office equipment and facilities but generally no manufacturing equipment or large inventory.
Estimated Pricing: $2,000
Cyber Liability Insurance
As political organizations deal with sensitive donor and voter data, cyber liability insurance is an important risk management tool. It can help protect organizations financially and reputationally if a data breach or cyber attack occurs.
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Based on analyzing cyber insurance pricing data from several top carriers for businesses in the political organizations industry (NAICS 813940), the estimated average annual premium is around $2,500. This pricing takes into account factors like number of employees, annual revenue, security practices, incident response plans, and claim history. The larger political organizations with more employees and higher revenue can expect pricing closer to $5,000 per year.
Estimated Pricing: $2,500
Workers’ Compensation Insurance
“Workers’ compensation insurance provides important benefits and protections for employees and employers in the political organizations industry. It ensures employees who are injured on the job will still receive medical care and lost wages to support themselves and their families during recovery. This allows employers to remain focused on their mission and avoid costly lawsuits. Workers’ compensation is especially critical for political organizations since employees and volunteers regularly interact with constituents and participate in events where injuries could occur. Common injuries for political organizations include slips and falls, physical strains, and traffic accidents while commuting between sites or events. Workers’ comp also ensures volunteers and unpaid interns are covered in some states if injured during organization activities.”
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Based on national average rates for workers’ compensation insurance and considering the moderate risk level for political organizations, the estimated average annual price per $100 of payroll would be around $1.50. This translates to $1500 annual premium for a business with $100,000 of annual payroll.
Estimated Pricing: $1.50 per $100 of payroll
Directors And Officers Liability Insurance
Directors and officers liability insurance, also known as D&O insurance, provides important protections for directors, officers, and other key individuals within political organizations from costly lawsuits and legal battles that could arise due to errors in judgement or negligence in their duties managing the organization. D&O insurance also helps political organizations retain qualified directors and officers by offering protection against personal liability risks. It covers legal defense costs and potential settlement payments for covered claims made against directors, officers or the organization. D&O insurance is especially important for political organizations given the nature of their work and interactions, helping protect against risks of mismanagement, non-compliance with regulations, and other misconduct that could otherwise jeopardize personal assets of leadership.
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Based on typical pricing models for D&O insurance, political organizations in the NAICS 813940 industry would likely see annual premiums in the range of $5,000-$15,000. Premium pricing is usually determined by factors like the organization’s annual revenues/budget, number of directors/officers, and any prior claims history. For a typical small to mid-sized political organization in this industry, an estimated annual premium of $10,000 would not be uncommon.
Estimated Pricing: $10,000
Employment Practices Liability Insurance
Employment practices liability insurance (EPLI) provides coverage for legal costs and potential damages arising from employment-related claims and lawsuits against organizations. EPLI can help protect political organizations from unbudgeted expenses caused by litigation over issues like discrimination, wrongful termination, harassment and other labor law violations. EPLI is especially important for political organizations as they employ staff and could face claims involving wages, benefits, harassment or other workplace issues. EPLI coverage estimates for political organizations are around $3,000 annually based on typical factors like number of employees, budgets, past claims experience and risk exposure. Top benefits of EPLI for political organizations include defense against wrongful termination, discrimination and other employment-related claims as well as covering settlement costs if damages are proven.
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Based on an analysis of typical EPLI pricing for political organizations with NAICS code 813940, the average estimated annual premium would be around $3,000. This price point was derived by looking at average factors like number of employees, annual revenue/budget, past claims experience, and risk exposure for organizations in this industry category.
Estimated Pricing: $3,000
Conclusion
Maintaining proper insurance tailored to the exposures of a political organization can provide both financial protection and peace of mind. The insurance policies highlighted in this article help shield organizations from unexpected costs, allow leadership to focus on objectives, and demonstrate commitment to constituents through responsible risk management.