Does nonprofit insurance protect volunteers?

Every year, millions of people donate their time to charitable organizations, like counseling referral centers, churches, community centers, and animal shelters. While volunteer work is a rewarding experience, it comes with risks that are often overlooked. Volunteers might slip and fall at event sites, suffer injuries while lifting heavy objects, get cut or burned while using kitchen equipment, or be exposed to hazardous situations during disaster relief.

Nonprofit organizations typically carry various forms of insurance, but they may be unaware of whether their coverage extends to volunteer programs. Understanding the specifics of who’s covered by a policy — and who isn’t — is essential for both the organization and those who give their time to support its mission.

Volunteers routinely encounter risks during their service. Even if a volunteer’s actions are well-intentioned, they could still result in an injury, hospitalization, accidental property damage, or another liability issue that turns into a lawsuit.

Consider these scenarios that highlight the very real risks volunteers face:

While moving a ladder, a volunteer accidentally hits a window and shatters the glass. You can never predict when an accident might happen, which is why it’s important to cover your organization’s volunteers with a general liability insurance policy. This type of insurance for volunteers helps cover the cost of accidental third-party injuries or property damage.

A well-meaning volunteer takes some photos at an event and posts them on your nonprofit's social media accounts. However, the volunteer didn't have the event participants sign photo release forms, and someone who was photographed sues your organization for using their image without consent.

General liability insurance helps cover the legal costs associated with the claim, including defense fees, a settlement, or a judgment — which protects both the volunteer and your organization from the financial fallout.

A volunteer helps set up an online donation portal for your website, making it easier for supporters to contribute. However, the site wasn’t properly secured, and a hacker gains access and steals sensitive donor information, including email addresses and credit card numbers.

Cyber insurance can help protect the volunteer and your organization in the aftermath of a breach by covering the cost of notifying affected donors, providing credit monitoring services, restoring compromised data, and defending against any legal claims. This helps your nonprofit recover financially and maintain donor trust.

When you purchased nonprofit insurance, you likely ensured it covered your organization and its employees. But did you check to see if your volunteers are also covered? It’s a question worth asking: do volunteers need insurance?

The work volunteers do involves real risks, which is why having the right insurance program in place is essential for your risk management plan. Whether your volunteers are covered depends on your specific insurance policies. Many nonprofits are surprised to learn their standard coverage may leave volunteers exposed to significant risk.

Before volunteers walk in your door, talk to your insurance agent to find out whether they’re covered by your nonprofit liability insurance. If liability coverage doesn’t extend to volunteers, ask your agent to add them as additional insureds to your liability policy. This ensures your organization is protected in case a volunteer:

• Experiences a personal injury
• Causes accidental property damage or injury to a third party
• Sues your nonprofit over an injury they received while volunteering
• Acts inappropriately, causing a third party to sue your organization

Be sure to work with an insurance agent who understands the unique needs of nonprofits and volunteer activities. An experienced agent can identify the right volunteer insurance for nonprofits, recommend policy adjustments, and guide you through the insurance products that best protect your organization and volunteers’ personal liability.

Multiple nonprofit volunteer insurance policies can work together to protect your team. It’s important to understand the specific coverage and limitations of each type.

Essential liability insurance for volunteers includes:

General liability insurance provides protection if volunteers accidentally cause bodily injury or property damage to third parties while performing duties for your nonprofit. For example, if a volunteer accidentally knocks over a display and injures a visitor at an event, general liability insurance typically cover the injured party's medical expenses and a potential lawsuit.

D&O insurance specifically protects volunteer management, board members, and officers from lawsuits related to the decisions they make. Also called Management liability insurance, this policy is crucial for volunteers in leadership positions. Without coverage, they could face personal financial liability for actions taken on behalf of the organization.

Fiduciary liability insurance protects volunteers who manage a nonprofit’s assets, such as retirement plans or investment funds. It covers claims of mismanagement, poor judgment, or breach of fiduciary duty. For example, if a volunteer accidentally misses a filing deadline, fiduciary liability insurance helps cover the cost of a penalty.

Commercial crime insurance protects volunteers who handle nonprofit finances from allegations of theft, fraud, or embezzlement. This coverage can help pay for investigation costs and financial losses. For example, if a volunteer bookkeeper is accused of misappropriating grant funds, commercial crime insurance can help cover the cost of an audit and the reimbursement of the stolen money.

It’s important to ensure volunteers understand what your insurance for volunteering covers. Being transparent about your volunteer workers insurance not only protects your organization, but it also helps volunteers make informed decisions. When volunteers know they’re covered, they can focus on supporting the mission instead of worrying about risks.

Here are some questions volunteers might ask:

Be prepared to explain the specific coverage provided to volunteers and under what circumstances. Discuss whether volunteers are automatically covered or whether they need to be specifically named as an additional insured. Also, be sure to provide documentation that shows volunteer insurance coverage, including policy limits, exclusions, and procedures for reporting incidents.

Volunteers should understand whether there are any limitations on coverage amounts or conditions that must be met for coverage to apply. Also, if your policies have activity-specific exclusions — like using power tools or participating in construction or cleanup efforts — make sure volunteers understand them before they participate.

While your organization's volunteer liability insurance provides crucial protection, you may want to inform volunteers about the benefits of obtaining their own coverage to have an extra layer of protection beyond what your organization offers.

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