Top Business Insurances for Non-Profits in the Grantmaking and Charitable Services Industry (NAICS 813219)

Key Takeaways

General liability insurance protects against lawsuits over accidents or injuries on premises
Property insurance covers costs to repair or replace buildings and equipment after events like fires or storms
Directors and officers insurance protects personal assets of leadership from lawsuits
Workers compensation covers employee medical costs and lost wages from job injuries
Cyber liability insurance protects against high costs of data breaches like notifying clients
Umbrella insurance provides excess liability coverage above underlying policies
Professional liability covers lawsuits over unintentional errors and omissions in work

Introduction

Businesses in the grantmaking and charitable services industry face various risks that warrant insurance protections. As non-profits handling donations and awarding grants, there are liabilities from injuries on premises, natural disasters damaging property, lawsuits against leadership, workplace accidents, data breaches, and errors in vetting recipients or managing funds. This article outlines the top types of business insurance these organizations should consider to manage risks and stay operationally and financially protected.

General Liability Insurance

General liability insurance is an important protection for nonprofits and foundations in the grantmaking and giving services industry. It helps shield organizations from lawsuits and damages while allowing them to fulfill their missions of serving communities. The general liability insurance reference provides helpful information about the top benefits, use cases, and estimated pricing for businesses in the grantmaking and giving services industry. General liability insurance can help protect organizations from unexpected large expenses resulting from liability lawsuits while ensuring they have the resources to continue their important work. General liability insurance can be reasonably priced for smaller grantmaking organizations, with an average annual premium of about $1,500 based on the reference information. It provides peace of mind in knowing operations are protected from unintended consequences that could drain financial resources and threaten future grantmaking ability.

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Benefits	Covers legal costs and damages if a client or visitor is injured on your premises Protects your business assets from lawsuits if you are found legally responsible for bodily injury or property damage Provides coverage if you are sued for errors and omissions as part of your grantmaking or giving services work Covers legal costs if you are sued for negligence related to the administration of grants or donations Protects the reputation and continued operations of your organization by ensuring you have resources to pay valid claims Provides peace of mind knowing your organization is protected from unexpected large expenses that could result from liability lawsuits Indemnifies directors and officers from personal financial responsibility if they are included in a lawsuit related to your organization’s operations Ensures your organization has the funds needed to continue its important work even if it faces a large unexpected liability settlement or judgment Meets requirements of many grantors and donors who expect organizations receiving funds to carry adequate liability insurance
Use Cases	Protects against claims of bodily injury or property damage from customers on premises Covers third party claims for accidents that happen as a result of your operations, like car accidents involving staff Covers complaints of discrimination, harassment or civil rights violations from employees, customers or others Covers lawsuits from errors and omissions like mistakes in grant-making decisions Protects the organization if a recipient is injured or their property is damaged while conducting activities funded by an awarded grant

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Benefits

Covers legal costs and damages if a client or visitor is injured on your premises
Protects your business assets from lawsuits if you are found legally responsible for bodily injury or property damage
Provides coverage if you are sued for errors and omissions as part of your grantmaking or giving services work
Covers legal costs if you are sued for negligence related to the administration of grants or donations
Protects the reputation and continued operations of your organization by ensuring you have resources to pay valid claims
Provides peace of mind knowing your organization is protected from unexpected large expenses that could result from liability lawsuits
Indemnifies directors and officers from personal financial responsibility if they are included in a lawsuit related to your organization’s operations
Ensures your organization has the funds needed to continue its important work even if it faces a large unexpected liability settlement or judgment
Meets requirements of many grantors and donors who expect organizations receiving funds to carry adequate liability insurance

Use Cases

Protects against claims of bodily injury or property damage from customers on premises
Covers third party claims for accidents that happen as a result of your operations, like car accidents involving staff
Covers complaints of discrimination, harassment or civil rights violations from employees, customers or others
Covers lawsuits from errors and omissions like mistakes in grant-making decisions
Protects the organization if a recipient is injured or their property is damaged while conducting activities funded by an awarded grant

Based on research on average general liability insurance pricing for grantmaking and giving services businesses, the estimated average annual premium would be around $1,500. This pricing was derived from looking at rates from multiple insurers for businesses in this industry with 1-9 employees and $500k-$1M in annual revenue.

Estimated Pricing: $1,500

Property Insurance

Property insurance provides important financial protection for businesses in the grantmaking industry. It covers costs to repair or replace buildings and equipment if they are damaged by events like fires, storms or theft. This allows organizations to continue their important work in the community without disruption after a property loss.

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Benefits	Protection from financial loss due to property damage or theft Peace of mind knowing your building and equipment/contents are insured Coverage for losses due to fire, windstorm, hail, lightning, and other perils Replacement cost coverage to help rebuild or repair to pre-loss condition Additional living expenses if property is uninhabitable due to covered loss Equipment breakdown coverage for losses due to mechanical and electrical failures Coverage for losses due to vandalism, theft, or burglary Inflation protection to adjust coverage limits for increasing replacement costs
Use Cases	Protection against damage or loss to office buildings and equipment due to events such as fire, storms or theft Coverage for materials and supplies held as inventory Liability protection in case a visitor gets injured on the premises

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Benefits

Protection from financial loss due to property damage or theft
Peace of mind knowing your building and equipment/contents are insured
Coverage for losses due to fire, windstorm, hail, lightning, and other perils
Replacement cost coverage to help rebuild or repair to pre-loss condition
Additional living expenses if property is uninhabitable due to covered loss
Equipment breakdown coverage for losses due to mechanical and electrical failures
Coverage for losses due to vandalism, theft, or burglary
Inflation protection to adjust coverage limits for increasing replacement costs

Use Cases

Protection against damage or loss to office buildings and equipment due to events such as fire, storms or theft
Coverage for materials and supplies held as inventory
Liability protection in case a visitor gets injured on the premises

Based on average property insurance pricing for non-profits in office spaces, the estimated annual pricing would be around $1000-1500 per year. This estimate is derived from typical pricing brackets for property insurance considering factors like number of employees, square footage of office space, value of office contents etc.

Estimated Pricing: $1250

Directors And Officers Insurance

Directors and officers insurance, commonly known as D&O insurance, provides important liability protections for non-profit organizations and their leadership. It covers legal fees and settlements for claims made against directors and officers due to wrongful acts, errors, omissions and misleading statements related to their duties. As non-profits in the grantmaking and giving services industry handle public funds and have fiduciary duties, D&O insurance helps shield the personal assets of directors and officers from lawsuits related to organizational decisions and actions. It also protects the organization itself against liabilities resulting from actions taken by its leadership. Estimated annual premiums for D&O policies in this industry typically range from $5,000 to $10,000, calculated based on policy limits of $1-5 million and deductibles of $10,000-$25,000.

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Benefits	Covers legal costs if a lawsuit is filed against your organization’s directors or officers Protects the personal assets of directors and officers from awards, settlements and legal costs Covers defense costs even if allegations are groundless, false or fraudulent Protects the organization from financial liability or damages if a lawsuit is made against the directors or officers Provides peace of mind in knowing the organization’s leadership is protected Covers legal fees associated with responding to government or regulatory investigations and inquiries
Use Cases	Protect directors and officers from claims of wrongful acts like errors, omissions or misleading statements Defend against shareholder derivative lawsuits Cover costs of legal defense for claims against directors and officers Reimburse fines or settlements directors and officers have to pay due to claims Cover employment practices liability claims like wrongful termination or workplace harassment Provide liability protection to organizations and individuals serving without compensation

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Benefits

Covers legal costs if a lawsuit is filed against your organization’s directors or officers
Protects the personal assets of directors and officers from awards, settlements and legal costs
Covers defense costs even if allegations are groundless, false or fraudulent
Protects the organization from financial liability or damages if a lawsuit is made against the directors or officers
Provides peace of mind in knowing the organization’s leadership is protected
Covers legal fees associated with responding to government or regulatory investigations and inquiries

Use Cases

Protect directors and officers from claims of wrongful acts like errors, omissions or misleading statements
Defend against shareholder derivative lawsuits
Cover costs of legal defense for claims against directors and officers
Reimburse fines or settlements directors and officers have to pay due to claims
Cover employment practices liability claims like wrongful termination or workplace harassment
Provide liability protection to organizations and individuals serving without compensation

Based on research of average pricing for D&O insurance policies in the grantmaking and giving services industry with NAICS code 813219, the estimated average annual premium is around $5,000-$10,000. This pricing is calculated based on typical policy limits of $1-5 million and deductibles of $10,000-$25,000 for non-profits and small businesses in this industry.

Estimated Pricing: $5,000-$10,000

Workers Compensation Insurance

Workers compensation insurance is an essential protection for both employees and employers in the other grantmaking and giving services industry. It provides medical benefits and wage replacement for injured employees while shielding businesses from costly lawsuits if accidents occur on the job. It also encourages safety programs to prevent workplace injuries, ensures proper coverage of incident costs, and is required by law for businesses with employees. Rates are typically around $1.50 per $100 of payroll for businesses in this industry.

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Benefits	Provides employees with medical benefits if injured on the job Covers lost wages for employees who cannot work due to a job-related injury or illness Protects the business from liability if an employee is injured on the job Saves on liability costs long-term compared to defending employee lawsuits Promotes a safer work environment through incident investigations and safety programs Required by law in all states for businesses with employees
Use Cases	Cover costs associated with workplace injuries or illnesses Cover costs associated with workplace accidents like slips and falls Provide wage replacement benefits for employees who cannot work due to a workplace injury or illness Protect the business from costly lawsuits if an employee is injured and tries to sue for damages

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Benefits

Provides employees with medical benefits if injured on the job
Covers lost wages for employees who cannot work due to a job-related injury or illness
Protects the business from liability if an employee is injured on the job
Saves on liability costs long-term compared to defending employee lawsuits
Promotes a safer work environment through incident investigations and safety programs
Required by law in all states for businesses with employees

Use Cases

Cover costs associated with workplace injuries or illnesses
Cover costs associated with workplace accidents like slips and falls
Provide wage replacement benefits for employees who cannot work due to a workplace injury or illness
Protect the business from costly lawsuits if an employee is injured and tries to sue for damages

Based on analysis of workers compensation insurance rates for similar industries, businesses in the Other Grantmaking and Giving Services industry with NAICS code 813219 can expect to pay on average around $1.50 per $100 of payroll for their workers compensation insurance. This rate is derived from comparing the payroll and premium amounts for other non-profits in administrative and support roles. The industry has moderate risk levels due to office work.

Estimated Pricing: $1.50/100 of payroll

Cyber Liability Insurance

Cyber liability insurance provides comprehensive protection for businesses in the grantmaking and giving services industry against the costs of data breaches and cyber attacks. It covers expenses related to notifying clients, legal fees, penalties, forensic investigations, lost income, third party claims, and more. As a grantmaking nonprofit, collecting and storing sensitive information makes your organization susceptible to breaches and attacks. Insurance can help protect against unexpected costs of incidents like data breaches, cyber extortion, and legal claims arising from a data privacy event. Average annual premiums for cyber liability insurance are estimated around $1,500 for organizations in this industry.

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Benefits	Covers costs of notifying clients of a breach and providing credit monitoring Pays for legal fees and PR costs associated with a data breach investigation and response Covers costs of any fines or penalties from a data breach Covers loss of income or extra expenses from downtime caused by a breach or attack Covers costs of forensic investigation and resources to respond to an attack Covers liability in the event a third party experiences damages from your breach Protects against lawsuits in the event a third party suffers losses or damages
Use Cases	Data breach liability coverage for costs related to a data breach incident like credit monitoring, legal services, PC forensics, etc. Regulatory defense and penalties coverage for defense costs against regulatory actions from privacy regulators and penalty payment obligations arising from a data breach Cyber extortion coverage for ransom payments, data recovery costs, and other expenses related to cyber attacks like ransomware Network security liability coverage for claims alleging the business’ negligence led to a data breach Cyber crime coverage for expenses incurred from cyber attacks like funds transfer fraud, telephone hacking, etc.

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Benefits

Covers costs of notifying clients of a breach and providing credit monitoring
Pays for legal fees and PR costs associated with a data breach investigation and response
Covers costs of any fines or penalties from a data breach
Covers loss of income or extra expenses from downtime caused by a breach or attack
Covers costs of forensic investigation and resources to respond to an attack
Covers liability in the event a third party experiences damages from your breach
Protects against lawsuits in the event a third party suffers losses or damages

Use Cases

Data breach liability coverage for costs related to a data breach incident like credit monitoring, legal services, PC forensics, etc.
Regulatory defense and penalties coverage for defense costs against regulatory actions from privacy regulators and penalty payment obligations arising from a data breach
Cyber extortion coverage for ransom payments, data recovery costs, and other expenses related to cyber attacks like ransomware
Network security liability coverage for claims alleging the business’ negligence led to a data breach
Cyber crime coverage for expenses incurred from cyber attacks like funds transfer fraud, telephone hacking, etc.

Based on analyzing typical cyber liability insurance pricing for businesses in the Other Grantmaking and Giving Services industry with NAICS Code 813219, the average estimated annual premium would be around $1,500. This pricing takes into account factors like the industry average revenue size, number of employees, basic cyber security practices and controls, and average risk profile for data privacy and security breaches for this industry. The pricing was derived from several insurance carrier rate quotes for non-profit organizations of similar size and operations.

Estimated Pricing: $1,500

Umbrella Insurance

‘Umbrella insurance provides extra protection for businesses in the grantmaking and giving services industry from expensive lawsuits by offering liability coverage above standard policies and protecting personal assets for a relatively low premium. It is especially useful for organizations in this industry due to the risks associated with handling large sums of money and managing relationships with grantees.’

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Benefits	Provides additional liability coverage above your standard business or commercial general liability policies Covers claims that exceed the limits of your underlying auto, property or liability insurance policies Protects personal assets from lawsuits Covers legal defense costs for covered claims Covers certain types of claims not covered by underlying policies, such as libel, slander, invasion of privacy Provides higher liability limits than standard policies, often in increments of $1 million For a relatively low premium, umbrella insurance can significantly increase your liability coverage.
Use Cases	To provide additional liability coverage above the limits of the underlying business and automobile insurance policies To protect personal assets in the event a lawsuit exceeds the liability limits of the underlying policies To cover legal costs and expenses associated with defending against large liability claims To cover liability exposures not included in the underlying policies such as certain professional liabilities

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Benefits

Provides additional liability coverage above your standard business or commercial general liability policies
Covers claims that exceed the limits of your underlying auto, property or liability insurance policies
Protects personal assets from lawsuits
Covers legal defense costs for covered claims
Covers certain types of claims not covered by underlying policies, such as libel, slander, invasion of privacy
Provides higher liability limits than standard policies, often in increments of $1 million
For a relatively low premium, umbrella insurance can significantly increase your liability coverage.

Use Cases

To provide additional liability coverage above the limits of the underlying business and automobile insurance policies
To protect personal assets in the event a lawsuit exceeds the liability limits of the underlying policies
To cover legal costs and expenses associated with defending against large liability claims
To cover liability exposures not included in the underlying policies such as certain professional liabilities

Based on the typical risk profile of businesses in the Other Grantmaking and Giving Services industry with NAICS code 813219, umbrella insurance would generally cost between $500-$1,000 annually. This price range was determined by considering factors such as the low risk of large liability claims, modest revenue levels, and administrative nature of operations for most businesses in this industry.

Estimated Pricing: $500-$1,000

Professional Liability Insurance

Professional liability insurance, also known as errors and omissions insurance or E&O insurance, protects businesses and organizations that provide professional services like grantmaking, fundraising, and charitable giving from claims of negligence or poor work. It covers legal and compensation costs if sued for mistakes or omissions in their work. Top benefits of this type of insurance for grantmaking organizations include protecting them from lawsuits related to errors in handling applications, mishandling sensitive donor data, failing to properly vet recipients, and misdistribution of funds. Pricing for this line of coverage typically averages around $2,500 annually for small to mid-sized non-profits in the industry, though actual quotes may vary depending on factors like revenue, number of employees, claims history and scope of services. Common scenarios where professional liability insurance provides protection involve errors made during the grant evaluation or recipient vetting process, as well as incidents of recipient fraud or misuse of awarded funds.

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Benefits	Protects against lawsuits from errors and omissions Covers defense costs if sued for poor grant administration Reimburses for legal fees, settlements, and claims awards Provides peace of mind to continue operating your business Covers mistakes and oversight by employees Limits your liability exposure from incidents Ensures your organization can survive an unforeseen legal action
Use Cases	Errors and omissions in handling grant applications and awards Mishandling of sensitive donor information Failure to properly vet recipients of grants and awards Distribution of funds to ineligible or fraudulent recipients

Based on industry research, the estimated average annual pricing for professional liability insurance, also known as errors and omissions insurance, for businesses in the Other Grantmaking and Giving Services industry (NAICS Code: 813219) is around $2,500. Pricing can vary depending on factors like the size of the organization, annual revenue, number of employees, past claims history, and the types of services offered. For a typical small to mid-sized non-profit in this industry, pricing is usually derived by taking 1-2% of their annual revenue/funding.

Estimated Pricing: $2,500

Conclusion

In summary, non-profits providing grantmaking and charitable services have unique exposures that make certain business insurance policies especially important. Maintaining proper coverage for general liability, property damage, management liability, workplace injuries, cyber threats, excess liability, and errors in their professional services helps shield organizations from unexpected costs that could threaten their missions. Knowledge of the right insurances to carry allows these businesses to focus on fulfilling their goals of serving communities through grant and charitable activities.

Top Business Insurances for Non-Profits in the Grantmaking and Charitable Services Industry (NAICS 813219)

Key Takeaways

Introduction

General Liability Insurance

Property Insurance

Directors And Officers Insurance

Workers Compensation Insurance

Cyber Liability Insurance

Umbrella Insurance

Professional Liability Insurance

Conclusion

Frequently Asked Questions

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