As we discussed last month, it’s important to hold fund raising events throughout the year to increase donor support and contributions. These events are often large-scale and require extensive planning to pull off effectively. While they certainly have the potential to bring in a substantial amount of funds, these events are also a significant risk for nonprofits. In order to help alleviate the risk that comes with planning large-scale fund raising events, nonprofits need to invest in the proper amount of insurance coverage.
What is a Special Event?
Before we discuss the intricacies of special event insurance, you need to know what a special event is. A special event, by definition, is an event that falls outside of a nonprofits core function (think large-scale fund raising events). Because these events are not the “norm”, nonprofit organizations are limited in their experience and knowledge regarding the requirements surrounding these types of functions. Risks at these types of events can range from personal injury and accidents to fraud and theft, cancellation due to unforeseen events, and nonappearances by featured performers or hosts. Additional coverage can ensure that your organization is protected from all of the associated risks.
What Coverage Do I Need?
Now that we’ve established what a special event is and why it’s important to have special insurance coverage for your fund raising events, we need to explain the type of coverage you’ll need. Special event insurance does exist, and it offers nonprofits great protection from lawsuits and claims brought by a third party; however, this insurance is generally expensive and is not practical if you a planning a single event. Depending on the type of fund raising event you’re hosting and your current insurance coverage, it might be more beneficial (not to mention cost-effective) to extend one of the following types of insurance policies rather than investing in special events insurance coverage. Any of the below insurance policies can be extending to cover your fund raising event:
- Comprehensive/General Liability: CGL insurance will cover claims that allege property damage or bodily injury. In the case of a special event, this coverage can be extended to include volunteers, members, temporary workers, outside sponsors, board members, and landlords.
- Fidelity: Fidelity bonds protect your organization against the loss of money or property due to dishonesty among staff or volunteers.
- Product liability: This insurance offers protection against claims resulting from injury or loss as a result of product malfunction from products sold or distributed at the event.
- Weather: This type of insurance covers the losses resulting from the cancellation of an event due to weather reasons. While it is particularly important to outdoor fund raising events, it is not restricted to outdoor events.
- Directors and officers liability: D&O insurance protects an organization from claims arising from managing directors or governing officials of the organizations. It includes coverage for both high-ranking staff and the members of the board.
- Nonowned/hired automobile liability: If your volunteers or staff are using their own vehicles during the event (or if you are renting cars or hiring drivers), you may need this type of insurance coverage.
- Nonappearance/cancellation: If your event is structured around the appearance of a celebrity or performer, this type of coverage could come in handy should he or she cancel. It protects your organization against all losses when your guest of honor fails to appear.
Your current insurance policy most likely covers some of the areas listed above; however, to be sure, you need to contact your insurance provider and see if your event has adequate coverage. If not, ask if you can pay a one-time premium for additional coverage during your fund raising event. While it may not seem crucial or necessary pay for additional coverage, you will wish you had the protection should someone file a claim with your organization after the event.
Make sure you include event insurance coverage in your event planning tasks and solidify any insurance changes or adjustments prior to the event. With the proper amount of planning and foresight, you can ensure that your fund raising events occur without a hitch.
Are you looking for more information on event planning? Stay tuned to our blog for more tips on planning a flawless fund raising event.