Streamline Your Billing Terms and Conditions Template for Nonprofit Organizations

Billing terms and conditions template for Nonprofit

hi welcome to the DC bar pro bono center today we're going to be talking about insurance and risk management assessments for nonprofit organizations I'm Scott levit I'm here with my colleagues Kevin glandon and Laura lock and we are all attorneys in Covington and burling's insurance Practice Group today we're going to talk about um insurance for nonprofit organizations and try to demystify the topic of insurance a bit it may not be something that you deal with every day and we're going to try to give you some of the basics so you're armed as you look at policies and think about the risks that your organization faces and what to do in the event of a incident we're going to talk about first how to read the policy then we're going to talk about several different types of insurance including commercial general liability insurance which may be the most common type of insurance that your organization makes okay so let's talk about the basics what is insurance insurance is a creature of contract just as a lease or um contract to by a car a lot of the same rules will apply to all types of contracts regardless of whether it involves Insurance an insurance policy protects against certain types of risk in return for payment of a premium by the policy holder to the insurer and different policies protect against different risks so what should you think about when you're buying insurance first what are the nonprofits assets what risk does nonprofit face who may be liable and who is covered so let's dig down into those questions what are the nonprofits assets typically a nonprofit's biggest asset is it people board members employees volunteers donors clients and the public and depending on the nonprofit you may have a substantial amount of property you could have a building that you either own or rent equipment that you use in your business and also intellectual property you have income that comes in whether they are sales from t-shirts or grants from government organizations or donations from uh people who support your mission and finally you have Goodwill you have the reputation you have the ability to raise funds and secure volunteers and uh you should not minimize the value of Goodwill uh it can be hard to Value but it's certainly important to any nonprofit organization so what risk does the nonprofit face probably most uh problematic would be injury to people somebody trips and falls on your premises or at an event somebody has a work injury whether they're driving to an event or on site uh doing something uh in furtherance of the nonprofits Mission or there could be some sort of negligent care in the services that you were providing to people you may have property damage uh there could be a fire storm a car accident uh unfortunately you could be the victim of criminal activity there could be theft uh investment and fraud some of that theft could be done uh through cyber uh rather than a physical incident and that could take the form of a data breach or hacking and finally you could have some sort of compliance failure where you are alleged to have violated legal or regulatory requirements and the government comes after you there are two main types of insurance the first type is first party insurance and that protects against losses that you as a policy holder sustain an example is you own a building there's a storm and the building gets damaged the other type of other main type of insurance with third party are also called liability insurance and this type of insurance protects against claims that are made by Third parties against the organization for instance somebody comes to one of your events they trip over a box uh that somebody left in the middle of the floor and they sue you in that instance your liability insurance would respond so let's talk now about how to read a policy hi my name is Laura lock and I'm an associate in Covington's litigation and insurance practice groups and I'm gonna walk through how to read a policy with you insurance policies can be very long sometimes hundreds of pages long and are often not written very clearly so do you really need to read the entire policy if you want to understand your coverage then yes you do really need to read the entire policy an insurance policy May Grant you coverage in the insuring agreement take it away through an exclusion dozens of pages later then give it back but only partially in an endorsement attached to the policy if you only read part of the policy you won't have a full understanding of what's covered and what's not our goal here is not to shortcircuit your review but to give you the tools you need to review effectively and efficiently this slide gives you an overview of the principal parts of an insurance policy there is the Declarations page the form or body of the policy which contains the definitions Insurance agreement exclusions conditions limits sublimit and deductibles there may also be a set of endorsements which are additional forms attached to the policy I will explain each of the parts in a bit more detail in the slides that follow so common policy features the declaration page is at the front of your policy it is usually the first page of the policy it summarizes some key information vital to the policy it's like the vital statistics of the insurance policy it generally lists the policy holders name and address the policy period the types of coverages provided coverage limits premiums the policy holder must pay to maintain the policy it also lists deductibles retentions or retained limits these terms refer to the amount the policy holder must pay on a claim before the insurance policy kicks in and provides coverage we'll talk more about those later although the Declarations page looks like a summary of the policy the endorsements at the end of the policy may change the terms of the policy from what's listed on the declaration page so it's important to review the entire policy and not simply re on the information in the Declarations page definitions within the body of the insurance policy you'll find a definition section the definition section is key to understanding the policy policies Define common words like the word loss or property damage and give them a special meaning the definition May narrow the meaning of a term in a way that narrows your coverage so it is important to read the definition section carefully terms that are not defined in the definition section are simply given their General common ordinary meaning when you're reviewing the rest of the policy defined words may be identified with bold print quotation marks or they might be capitalized some policies however do not make clear which words are defined so it is important to review the en entire definition section and keep it handy as you review the rest of the policy insuring agreements insuring Agreements are also within the body of the policy an insuring agreement is a statement of what the policy covers the policy may call the insuring agreements a coverage and there may be more than one coverage section setting forth different types of coverage for instance in commercial general liability policies that cover different types of losses you may see a section titled coverage a bodily injury and property damage coverage and then a separate section titled coverage B personal and advertising injury coverage the insuring agreement is modified by the conditions exclusions and endorsements in the rest of the policy there are typically a lot of defined terms in the insuring agreement so it needs to be read side by side with the definition section to be properly understood exclusions policies also typically contain an exclusion section the exclusion section sets forth the losses not covered by the policy for instance most property damage policies exclude damage caused by flood or earthquakes you usually need to purchase separate insurance and pay a higher premium if you want coverage for those losses the exclusion section can also contain exceptions to a particular exclusion so it might say for instance we will cover damage to your airplane except on under these particular pardon we will not cover damage to your airplane except under these particular circumstances a through C this makes it clear that circumstances a through C are covered under the policy exclusions are not only found in the exclusion section they could also appear in the endorsements which are tacked on at the end of the policy they may also appear in the body of the policy but outside of the exclusion section so it is important to read the policy carefully and look for any exclusions throughout the policy conditions conditions are requirements the policy holder must meet in order to obtain coverage like with exclusions you should look for a condition section or requirement section but still review the whole policy for conditions not listed in the condition section giving notice is an example of a common condition many policies provide that the policy holder must give notice of a claim within 30 days or within a reasonable time period after learning of the loss if you do not give timely notice you may wave your right to coverage another example of a condition is a requirement that the policy holder cooperate with the insurer's investigation meaning the policy holder has to provide information about what happened and the nature of the loss or damage when the insurer asks for it the policy might also require that you obtain the insurer's consent before hiring a lawyer or settling a claim review the policy and identify all conditions your organization must meet in order to qualify for coverage and keep a list handy so that when an accident occurs or when someone sends your organization a demand letter and you think they may sue you know what steps your organization needs to take to maintain its claim for coverage limits subl limits and deductibles limits are the maximum amount of money an insurance policy will pay out for a covered loss policies May provide a per claim or per occurrence limit which is the most the policy will pay on each claim or each occurrence that leads to a loss the policy may also limit the a may also list an aggregate limit which is the most the policy will pay out for all accidents or all claims that occur during the policy period your policy may also contain sublimit which further limit the amount your policy will pay out for a specific type of loss for instance a property damage policy may have a limit of $1 million per claim but a mold sublimit of $50,000 that means means you don't get to tap the full 1 million for mold damage you are capped at $50,000 supplements May cap coverage for a single type of incident a type of damage like mold or a particular category of property a deductible is the initial amount of loss not covered by the policy that the policy holder must absorb you're probably familiar with the concept of a deductible from your health insurance or car insurance for example your car insurance might have a $1,000 deductible which means that if you are at fault in a car accident with damage of $5,000 you're responsible for paying the first $1,000 out of pocket before the insurance kicks in and begins providing coverage you can negotiate the amount of your deductible with the insurance company but typically the lower the deductible the higher the annual or monthly premium endorsements endorsements or policy forms attached to your insurance policy that modify coverage so why don't insur simply modify the body of the policy well insurance companies typically issue Insurance using standardized coverage forms so the body of your policy is typically a standardized form if the policy holder does not want to pay for a particular type of coverage or wants additional coverage not provided in the standardized form rather than modifying the standardized form the insurers tack on additional standardized endorsement forms to add or remove coverage from the coverage granted in the body of the policy the endorsement may be added after the policy is issued and may have language at the top of the endorsement indicating when the endorsement becomes effective you can see that on the example in this slide endorsements can also modify a aspects of the policy including the scope of coverage limits of coverage or change who qualifies as an ensured under the policy since endorsements can seriously impact the coverage provided by a policy is it is important to read them carefully with that primer let's turn towards a discussion of particular types of policies you may have I will turn it over to Kevin to discuss commercial general liability insurance thank you Laura uh my name is Kevin Glennon and for the next several slides we'll be taking those general principles and applying them to specific types of insurance coverage these next sections are intended to be reviewed together with your DC pro bono Center insurance and risk management assessment tool so these slides refer to questions on that assessment tool and they should help you understand what you're looking for and the implications of what you find commercial general liability insurance as mentioned is is third-party Insurance it protects you and your organization against claims that your actions caused harm to someone else these policies typically provide two types of protections at a high level Indemnity and defense Indemnity is the protection where the insurer will pay for legal liability incurred by the insured such as your organization through a lawsuit or other legal proceeding this might be a judgment that is handed down it could be a settlement that you enter into with the claiming party typically this will be for bodily injury property damage or personal injury the words personal injury May depending on your policy refer to things like defamation and other torts as opposed to bodily injury but you'll have to read the policy for sure policies also typically cover defense this means that the insurer is often required to hire and pay an attorney to defend you this is a very important protection especially for nonprofits the duty to defend in other words pay defense costs and control your defense is typically broader than the duty to indemnify in other words pay liability costs that's important because a lot of what in organizations need protection for is the legal defense um but it also means that just because the lawyer defends you does not necessarily mean that when there is a judgment or a settlement that it will be covered so additional advice in this space is important the policy may give the insurer the right to consent to selection of Defense Council or even to control the defense under cgl policies defense costs are usually what's known as outside limits meaning they do not erode your limits of coverage however it is important to confirm so turning to the assessment tool question one and I will be talking about certain key questions for the next several slides but I will not return to SL to questions that we've already discussed so we'll focus on the teen new questions or questions where there has been an important qualifying point to raise so question one on the cgl checklist is your policy a claims made policy or An Occurrence policy claims made means it is triggered by a claim the policy will pay on claims made or made and reported to the insurer during the policy period or some other specified period as specified in the policy we have an example on the slide of a type of insuring agreement that shows you that this is a claims made policy another type of policy is an occurrence-based policy this is triggered by An Occurrence a term of art that means that it pays claims related to something that happens the loss event during the term of the power policy regardless of when the loss when the occurrence is presented to the insurer and here again we have an example of some language where you can see an An Occurrence uh coverage tips here would be looking for that insurance agreement insuring agreement portion of the policy to determine whether its claims made or occurrence-based uh the terms claim and occurrence are often defined also in the definitions section question two what dollar limits does the policy specify per occurrence in the aggregate per claim or for for deductibles uh the per currence or per claim limit this is the maximum amount of liability the policy will cover for any specific claim or occurrence so say for example a person sues the organization it may be a per claim limit associated with that if there is a slip and fall accident uh there may be that may be An Occurrence and if somebody sues they there may be a per event limit however in addition to per claim and occurrence limits there are almost always aggregate limits this is the maximum amount of liability that the policy will cover the payment of claims reduces the aggregate limit so if you hit that limit the insurance company May discontinue to provide any support under that policy including discontinuation of Defense costs but that will depend the deductible as mentioned by Laura is the initial amount of loss not covered by the policy uh you may see language about self-insured retentions which uh function slightly differently but in any event relates to amounts that you will need to pay tip here limits are commonly found any limits of liability section in the Declarations portion of the policy question three what sublimit apply well if we have a limit what is a sublimit a Lim a sublimit exists uh to reduce coverage for a particular type of event or a particular situation fortunately however they are typically of limited scope so where a sublimit applies your limit is going to be lower on the other hand you're probably only going to see a supplement related to a particular type of incident damage or property tip here is that the dollar amount of any supplement is typically shown in the Declarations portion of the policy however make sure to read the policy to determine whether all or only part of a particular loss is subject to a supplement question four does the PO policy extend to Legal defense we've talked about the duty to defend where this exists and you can see language here typically something along the lines of we will have the right and duty to defend the insured against any in this case suit seeking certain damages the duty to defend means the insurer is obligated to assist the insurer in mounting a legal defense against claims and this is broader than the duty to indemnify meaning that even if somebody makes a claim against you that is fraud false fraudulent groundless or ultimately unsuccessful arguably the insurer should provide you a defense now typically the insurer has the right to consent to the selection of Defense Council or possibly even to control the defense now if you're policy does not contain a duty to defend it may contain reimbursement language this is where the insurer will reimburse the organization for the legal fees and expenses it incurs and again we have some language here showing how that type of clause might appear in your policy again for cgl insurance usually defense costs are often outside the limits and your policy may not be as clear as this but here's some language uh these payments will not reduce the limits of insurance that's quite clear uh some policies are less clear uh but you should read carefully for that or ask your broker or insurance company to clarify question five what locations are covered this is important especially for an organization that operates or has missions or other activities in multiple jurisdictions make sure that your policy covers you in every state in which your organization operates you may find that a policy was put into place a few years ago uh covering when your organization was smaller or at a different scope of activity and for cost purposes the scope is limited to two or three states but now you're bigger but if your policy isn't bigger you may have some significant exposure and that should be fixed either through the next renewal or immediately through an endorsement that changes the nature and scope of your coverage territory question six who are the named Insurance under the policy are employees included as named Insurance under your cgl policy what about volunteers if anyone associated with your organization is not listed as a named insured or in a section about that your policy may not cover claims made directly against that person the Declaration portions of the policy may explain who is covered in the name insured section but this section may only list the entity that purchased the policy so you should also be on the lookout for a definition of insured or a who is an insured section question seven what are the key exclusions these are the gaps it's important to know where the gaps are and mind them if an exclusion applies the policy may not cover the liability even if it would otherwise be covered for example and this is a common misunderstanding here the expected or intended exclusion which will exist in almost every policy provides that there is no coverage for liability resulting from intentional Acts or where the injury is expected however this does not necessarily what mean what mean what people think it does for example over the long term you could expect that slip andf fall accidents might occur does that mean that you expect slip and fall accidents and therefore it's not covered no this does not apply a general non-specific expectation of liability over the course of some policy period that's why people buy insurance also intended usually means intended from the perspective of the insured so if an employee does something that causes someone harm it is often the case that the organization itself which is an insurer did not intend for that to happen and therefore this exclusion often should not apply other examples of common exclusions that may exist in a cgl policy pollution war and terrorism cyber mold and fungus ASB bestus take a look in your policy for the word exclusion and if you find an exclusion that is problematic for you I would suggest uh buying an endorsement or looking into an additional policy question eight how must notice be provided in other words how much do you tell the insurer that something happened and what do you have to tell them here timeliness is important if the notice is late the claim may be denied prompt notice of a claim or loss is typically required but the specific requirements vary a policy may say loss a notice May must be provided immediately or as soon as reasonably practicable or within a certain specific number of days also you should pay attention to what triggers notice must notice be provided regarding circumstances that could give rise to a claim for example you heard that somebody was injured but nobody said anything yet Perhaps that would be a circumstance that would give rise to a notice and you should let the insurance know insurers know because if you don't the insurers May later say well you knew about this but didn't tell us and therefore you have failed to satisfy the notice conditions the content of the notice requirement may change depending on the policy you may have to uh take action to protect property from further loss you may have to prepare um sub additional uh information about what happened you may have to uh make a property uh where this slip and fall occurred available for inspection you may have to um provide any copies of any written letters or suits uh to the insurer now let's talk about dno insurance directors and officers insurance this is vital for a nonprofit this protects your directors and officers your board members um makes clear makes sure that people will want to run your organization and want to help out an organization's board of directors and officers dnos sometimes employees um are usually protected for liability under this type of insurance um or this would be liability arising from service based on um their role as a director or officer it may also cover organizational liability this is a funny type of insurance that has sides and uh there's often three sides to directors and officers insurance side a is the dno's liability that is not indemnified by the organization side B covers the organization's payment of indemnification to the directors and officers and side C would protect the liability of the organization itself big dno risks these days uh include failure to implement proper cyber protections you'll hear later about cyber Insurance and financial management and use of donor funds those are typ of risks that dno insurance might help protect your DN against question One dno Insurance is typically claims made that means it covers claims made during the policy period um questions two and three policy policies typically include an aggregate limit on all claims under the policy as well as limits on individual claims so here's a case where paying attention to the aggregate is really important if you have claim against the organization and there's a specific per individual claim uh per individual limit but then there's an aggregate limit against all claims the question is do is your aggregate large enough to actually protect your organization otherwise you might have different people searching for their own share of the limits question four will the policy cover a director's defense costs take a look are employment related claims against directors cover or is that something you'll have to find protection for elsewhere consider also under question seven purchasing an extended reporting period coverage to avoid gaps in expiring policies okay Switching topics to property insurance well what is that this is first party Insurance it covers your organization's losses typically your building your vehicles um your business personal property computers etc um in terms of the types of loss it is very important to take a look and find out if your property policy is an allrisk policy or a named peril policy an allrisk policy covers all perils unless specifically excluded a named peril policy on the other hand covers only those perils named in the policy which is for example a fire Windstorm hail um when you're looking at the types of loss that could occur following a um a property insurance event you can have both physical losses and what are called time element losses or economic losses um as to the physical losses does your policy cover replacement costs or actual cast value how does your policy value a loss will you receive enough to rebuild the repurchase or just compensation for the diminished value of the asset as to time element losses your policies May cover the insured for income loss due to a covered event or for extra costs of emergency action or continuing the business during rebuild looking at the questions question one a Peril is the cause of loss make sure to review all named perils or to check whether it is an allrisk policy and to look for any exclusions question two policies typically provide different treatment of different types of property for example computer equipment and data storage media may be excluded or treated differently tip here would be that coverage for causes of loss commonly excluded from property policies such as flooding or cyber events may be available for purchase through a standalone policy or add-on even if your policy covers some of these losses to a degree and you may find um a certain degree of protection for your computers and other computer equipment um a lot of the risk there is being transferred into cyber policies um and you'll want to make sure that you have the appropriate level of coverage and that may mean purchasing a separate policy make sure to re-evaluate the risks associated with h climate change including risk of flood wildfire and hurricanes where are your businesses where are your where are your um locations at are they in a flood zone um there are FEMA maps that could help you find that out but the risks seem to be higher than the flood maps uh sometimes show and we've seen that in the news same thing with fires same thing with hurricanes and depending on where you're located in the country you may have seen this already in terms of significantly increasing rates for renewals question three consider the organization's financial situation and how it would handle a major loss actual cast value for example is unlikely to be sufficient to replace the damaged property it costs more to buy a replacement cost uh policy but if your building is destroyed and it would cost you know let's say $2 million to rebuild it now but your actual cash value policy only covers the diminished value which is let's just say for the moment $500,000 and your policy then says well you're completely destroyed it's going to cost you 2 million to re rebuild but this policy you've bought only provides 500,000 suddenly you have a gaping hole in your budget question four co- Insurance do you have it in the context of property insurance typically this relates to a requirement that the property be insured for at least a specified percentage of the value of the property measured at the time of the loss in other words the insurance company is wanting to know are you actually paying them enough for the current value of your property and if your policy has not been reviewed in several years it's possible that the value of your property is different um than then is listed in the policy and although that may lead to Temporary lower rates it also May mean that in the event of a catastrophic loss you have a penalty to pay based on a formula listed in the policy question five in addition to covering damage to property property insurance May other also cover other expenses and losses that relate to the loss of property for example employee dishonesty typically covers theft this could be a section in your policy or it could be an entirely different policy law and ordinance coverage this is important it typically covers the increased cost of complying with building codes at place at the time of the loss so if your building was built a long time ago and it's significantly damaged and it has to be brought up to code Ada Etc it may cost a lot of money to make those changes you need to know whether your policy is going to cover that or whether that's going to fall to you boiler and Machinery coverage will typically cover equipment it may cover Interruption associated with the loss or breakdown of equipment um you'll want to make sure you understand what type of equipment uh could break down and affect your nonprofit if your policy does not cover the risks as always you may be able to purchase additional endorsements to your policy or entirely separate policies moving on to Employment Practices liability this is another common risk like everything else you definitely ought to have this coverage this protects the organization against certain claims by workers or applicants people may not even work for you get that their legal rights have been violated claims may take many forms including discrimination sexual harassment wrongful termination or retaliation policies may also cover breach of employment contract defamation failure to promote negligent evaluations workplace torts uh sometimes these policies may include arbitration Provisions so whenever you have a bunch of people working together or working with management there's a possibility that someone may feel that they have been wronged and this is the type of policy that you'll want to protect yourself against that circumstance question One Employment Practices liability may be provided for in a separate policy or policy section or may be covered claim under a general liability provision as to the separate policy or policy section that's relatively easy to determine either you have a separate policy and usually would have something related to Employment Practices in the title or that may be the name of a section in your larger you know business policy um but if you don't have that you would at least want to check your cgl policy to see whether or not an Employment Practices liability claim may be covered under your cgl this will take careful reading and you may want to talk to your broker or insurance company and then get a second opinion question four for employment liability policies defense costs are often included included in the limits of insurance this means that the payment of attorney's fees will decrease the total amount of coverage you have here's some example language that shows this and you and and as many things happen in the context of insurance policies you have to read through the definitions here we have each payment we make for damages or defense expense reduces the limit of insurance well what is defense expense defense expense is separately defined to mean many things including for example attorney's fees so this is important because in many cases for in Employment Practices liability defense costs exceed the damages question seven pay close attention to exclusions as they may materially impact the extent of coverage for Employment Practices liability for example the following may be excluded punitive damages intentional acts we talked about that one briefly statutory benefits such as Arisa Cobra OSHA issues workers comp uh which we'll talk about ADA contractual liability and criminal fraudulent or malicious acts question eight carefully review the notice requirements and the definition of a claim including whether the claim must be written or could be oral treat employee complaints as claims and provide notice now now let's talk about professional liability or Eno coverage errors and omissions this is the type of insurance that you'll want if your organization employs lawyers medical professionals Mental Health Counselors therapists social workers Architects accountants or other professionals who provide Professional Services any of these um types of persons will have their own insurance for providing their special services and if you employ them to provide a benefit to the public you will need professional liability or re insur you know insurance this is typically not covered by Standard cgl Insurance is that type of insurance generally requires B injury or property damage as to question one on your form what types of Professional Services does your organization offer does your policy provide coverage if one of your professionals makes a mistake think about it question seven what types of errors or omissions are covered by your policy this is a careful language reading exercise for example does it cover breach of Duty like if an employee attorney mismanages client funds or breaches client confidences the lawyers have duties to their clients if they breach them you may be liable does your policy cover that another example would be and here's a comparison negligent act error or Omission versus negligent Act act negligent error negligent Omission arguably the former would cover negligent acts plus errors or omissions whether negligent or not whereas the latter would cover negligent acts but it would only cover errors and omissions that result from negligence so you have to read policies very closely so with that I will now turn it over to my colleague Laura to talk about workers comp thanks Kevin um so turning it over to workers comp um workers compensation or workers comp um is typically required by state law um here in DC for example workers comp insurance is required if the employer has one or more employees workers comp insurance covers the medical expenses in a portion of lost wages of employees who suffer on the job injuries coverage is provided regardless of whether the employee is at fault it's important that your organization have workers comp insurance not only because it is required by state law but also because it minimizes your risk of dealing with an expensive lawsuit from an injured employee with workers comp coverage the employee is covered sorry the employees is offered compensation for their injuries and lost wages in exchange for a mandatory relinquishment of their right to sue the employer for negligence workers comp policies may also provide related coverage such as Employment Practices liability insurance which can cover claims by employers by employees that the employer failed to provide a safe work environment in assessing your coverage first and this goes along with the first question of the assessment tool check to make sure that the policy covers employees in every state in which your nonprofits employees are located you also need to check that your coverage in these states is consistent with the state law requirements which means figuring out the workers comp insurance law in each state where you have employees the Department of Labor's website has a link the state workers comp websites for each state and this should be a helpful starting point second check whether your organization has a process in place for collecting certificates of insurance from subcontractors and sub grantees you want to make sure that workers comp is available to the employees of your subcontractors and sub grantees so that they are covered and you're not profit is not exposed to liability if they are injured while working on your property or with your organization turning next to business auto insurance business auto insurance covers liability and may also cover physical damage protection for vehicles that are used for the nonprofit's business the liability portion of the policy covers the cost of damages to other vehicles or property and personal injuries caused by accidents when the driver of your organization's vehicle is at fault the physical damage portion of the policy covers repair of physical damage to your organization's own vehicle your organization should get business auto insurance if your organization uses a vehicle to run errands pick up and deliver Goods carry tools transport clients or for any other aspect of your nonprofits business business auto insurance can be tailored to the needs of your organization so for example if you have a vehicle that you use for your you use primarily for business purposes you can secure business auto insurance to cover any employees and volunteers who drive that vehicle for business purpose purposes let's say on the other hand the nonprofit itself does not own a vehicle but you have a bunch of employees who use their personal vehicles for the nonprofits business your employees personal auto insurance policies may still cover them in the event that they cause an accident while driving for business purposes but if it's a major accident their personal Auto coverage may not fully cover the damages and the injured parties May seek to collect damages from your business you can seek business auto insurance that covers any of your organizations employees or volunteers when they drive any vehicle on business now let's go over a few points you should check when assessing your business Auto coverage again each of the questions appear on the assessment tool as well question three check who is listed as a named insured on the business Auto policy and think about who at your organization drives V Les on business if you have volunteers and employees driving on business you may want to make sure they are treated as an insured under the policy so that the policy will provide coverage in the event that they cause an accident while driving on business question four you should also check how broad your coverage is and whether it meets the needs of your nonprofit given your vehicle use if your employees and volunteers Drive their personal vehicles on business or if your organization uses rental cars you will want to secure non-owned and hired business Auto coverage Additionally you should make sure that your policy includes uninsured or underinsured motorist coverage all organization Vehicles should have this coverage and it may be required by state law also check to see that your policy covers medical costs regardless of who is at fault in the accident medical payments insurance is required by some states and you will want to make sure that your policy includes this coverage given the potential costs of medical payments in the event of a major accident finally question five of assessment addresses background checks your policy May exclude from coverage drivers who have committed certain moving violations and your policy might require your nonprofit to perform background checks on the driving records of all persons authorized to drive your organization's Vehicles if the policy requires background checks you should make sure that the background checks are updated regularly since this may be a condition to coverage and you may not be covered if an accident occurs and it turns out that the employee at fault had committed certain prior removing violations that excluded the employee from coverage under the policy now I will turn it over to Scott to discuss cyber risk coverage we live in A Brave New World where almost every organization every person faces some sort of cyber risk it's impossible to avoid in modern circumstances so what is cyber risk cover it covers a liability which is means a third-party claim arising from a data or security breach often involving sensitive or private information this can take place in the form of a hack or ransomware attack it can be started if uh an employee or a volunteer accidentally clicks on an email that has a linked malware or it could be a targeted intrusion into your system uh or a denial of service so when considering whether to buy cyber Risk insurance you need to consider your organization's risks and I'll note that not every nonprofit does purchase cyber insurance but we are seeing more and more uh nonprofit organizations buy cyber risk policies so considering your organization's risk what type of information does the organization hold is it holding medical information sensitive uh financial information of people or other information that would be particularly harmful if it was ever accessed or disclosed essentially any organization that stores and maintains customer client or patient information should consider cyber insurance so question one is assessing your coverage for data breaches have in malware and other cyber risks because those risks are often excluded from cgl or general viability policies separate cyber policies are available the market for cyber policies is continuing uh to evolve insurers come into the Cyber Insurance space they leave it uh and they come out with new products all the time so the products that insurers are offering in the cyber space have to be carefully evaluated commercial general liability policies May cover law uh lawsuits alleging violation of privacy under the policies coverage for personal injury they may cover emotional D distress or mental harm or loss of use of properties such as credit cards but these uh general elding policies more and more have cyber exclusions but the first step is to see whether you may actually have some C cyber related coverage under your cgl policy and that may be enough but often it isn't uh due to the prevalence of cyber exclusions property insurance May cover damage to your Hardware or data or loss profits in the event of a cyber incident again uh property insurance policies often have cyber insurance so you should check to see whether there may be any cyber coverage at all and due to your property policy dno policies generally cover suits alleging value to prev uh prevent or disclose a cyber incident uh but those policies vary as to whether they cover employees and whether there has to be a Securities claim alleged but there may be coverage nevertheless under dno policies so the takeaway is that um exclusions vary among cyber policies and other policies so you must read that closely I'm going to talk now about excess insurance so what is excess insurance excess Insurance applies above a primary policy limits or a certain retain limits and this gives you extra coverage in the event that the cost uh to defend a claim uh or settle a claim exceeds the limits of your primary policy the question one in the excess Insurance section is uh looking into your excess policies in that they come in different forms and they can vary significantly and that affects the scope of coverage uh and the complexity of pursuing a climent of those policies an umbrella policy typically provides a broad uh based liability coverage on top of certain existing primary policies uh those are typically Auto liability employers liability and general liability as with commercial general liability policies an umbrella policy May provide broad-based protection against a wide variety of risks but it also contains a variety of exclusions that may be imported sometimes the terms and conditions uh May differ from the primary policy sometimes the umbrella can provide broader coverage than the primary policy uh but by the same sometimes they restrict coverage related to Umbrella is another type of excess policy that's uh what is generally called follow form those type of policies provide excess coverage over one or more specified primary policies and they typically say that they follow the terms and conditions of the primary policies though they add some additional wording that may affect the scope of coverage question six on the evaluation is which policies are primary to your or follow form excess policies if you have a primary policy that is not listed on your excess policy the excess policy may not provide coverage if that Pro primary policy is exhausted so it's very important to look at your excess policies and figure out what is listed and what is not listed so you want to identify the limits of the excess policy in the event of the loss you want to make sure to track the exhaustion of those limits and bear in mind that it may be necessary to provide notice of a claim or loss to the excess insurer right away at the same time you're providing notice to the primary insurer even if the underlyings have not been exhausted and even if you think the underlying limits may never be exhausted it's always good to provide notice early um so that it can't be raised as a defense later on down the road if your insurer were to argue that notice was untimely finally I'm going to talk about some other policies property policies often cover business Interruption but occasionally we do see see separate Standalone business Interruption policies and what those policies cover is a loss of Revenue or profits arising from a covered incident and under property policies that's usually a physical incident such as a storm uh or perhaps uh a government shutting down an area uh uh for civil right or something we had that in DC uh several years ago during the pandemic you may have a service Interruption policy and again that may be included in your property program and that covers uh things such as a loss of utilities loss of Internet services which causes you to lose Revenue Fidelity bonds are specialized insurance policies that generally cover wrongful acts by employees or contractors such as an employee stealing uh cash out of a lockbox uh but it certainly can involve more complicated scenarios than that there are special event policies uh particularly for offsite events uh these sometimes include liquor liability coverage um you should check to if you are having a special event when whether your existing policy uh will cover that uh uh or if not you would want to talk to your broker uh to see whether a special event policy may be worthwhile we see certain organizations uh procure child or sexual abuse policies um sometimes that's and oftentimes that's included within a general liability but it's a special add-on Poli policy it's not generally offered to all insured those Ty uh type of policies or coverage can be crucial for any nonprofit uh dealing with children and it's often excluded from general liability policies unless that coverage is specifically requested uh and it's often comes with an additional premium there are specialized policies for equipment uh though those uh coverages are also often provided under property policies same thing with electronic data processing uh you may have equipment that does that for you and that is often covered under your property policy uh but if it's not there are Standalone policies that cover that so what should you be looking at with regard to all these other policies uh including the specialized Standalone policies or uh the policies that we've been talking about throughout this presentation for every additional policy you need to identify what is the risk covered is it a risk of fire is it a risk of theft malpractice or something else particularly important uh when you review the policy is learning who is covered by the policy for instance is only the organization covered or Does it include employees also Does it include a volunteer that's often particularly important uh for a nonprofit organization because you want to encourage people to volunteer uh and if there is a incident and one of your volunteers is sued and there's no coverage that is not going to reflect well on your organization and it may cause you various other headaches so when you're looking at these other policies you want to consider what loss is covered is it a personal injury uh such as a bway injury somebody falling down uh somebody getting hit by a baseball at a charity uh baseball game or property damage uh you have an event in a space and somebody breaks something in the bathroom and uh the host of the space sues you for that damage you want to understand how much the Lost occur uh could it be uh through a negligent action of an employ a contractor a donor uh somebody attending your event or does it need to be some sort of natural external Force like a flood where does a policy apply some policies Pro uh provide coverage only for uh losses or claims arising out of the United States or sometimes even within a particular jurisdiction so you want to know um more about that particularly if you have operations that are occurring outside of your home location quickly uh pul liability policies generally fall into two categories a claims made or An Occurrence basis claims made means that the claim has to be asserted during the policy period and usually also reported during the policy period or within a specified number of days after the policy for example 90 days is fairly typical or like liability policies can be written on An Occurrence basis which means that the underlying incident or damage has to occur during the policy period and uh you could have An Occurrence policy that is implicated because of a loss say that Happ or an incident that happened in five years five years ago but that claim from that occurrence only is asserted during the current policy period you want to look at what type of coverages provided uh there is Indemnity Only coverage uh and also there uh are policies that provide a duty to defend and the main difference between Indemnity and a duty to defend policy is that with a duty to defend the insurer pays the attorneys on behalf of the policy holder so the policy holder doesn't have to spend money out of its own pocket with an Indemnity policy by contract policy holder pays for the expenses then goes to the insurer and says pay me back you want to understand what are the policy financial terms what are deductibles uh what are self-insured or retentions or underlying limits so these are all financial terms uh that must be satisfied before the policy actually pays real money you want to look at what's called an aggregate limit that is a total over arching limit that specifies the maximum amount that the insurer will ever pay on the policy you also want to look at what are subl limits and what we see frequently is that insurers offer all these uh terrific coverage as bells and whistles to your policy but then they stick it with a really small supplement uh for instance uh we see uh supplements on what's called social engineering fraud where which is a scenario where somebody pretends to be say the organization's president and asks calls up an employee and ask them to wire $220,000 to an account uh and it turns out that the account is uh controlled by a fraudster there can be coverage for that type of scenario but generally insurers don't like it uh and they want to limit their exposures that so they stick a very small sublimit on that type of coverage finally you want to look at what are the notice requirements some insurance policies require notice as soon as practicable some uh have more wax timeline uh requirements for giving notice but generally we recommend that notice of an incident or a claim Prov be provided as soon as possible so that there can be no dispute down the road with the insurer whether you provide provided notice in ance with policy terms so that's all of our presentation we thank you for listening and viewing the presentation if you have any questions you can reach out to uh Covington team on this presentation at dcbar insurance.com thank you and have a great day