Nonprofit Insurance Checklist: Auto Insurance for Nonprofit Organizations

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Commercial auto insurance for your nonprofit’s vehicles is a no brainer and required by law (at least liability coverage is).

Either your nonprofit owns vehicles, or it doesn’t.

Having insurance is one thing. Having the correct insurance to fit your needs and your risk tolerance is something else entirely.

For instance, I do not allow my clients to have less than $1,000,000 in liability coverage (although a few have been grandfathered in at $500,000).  I’ve lost opportunities because of my stance.  My risk tolerance on behalf of some of my prospects is much lower than theirs is apparently.

Some insurance agents are willing to offer coverage at state minimum limits on commercial vehicles. Personally, I believe that’s not the most responsible approach.

Commercial Auto Insurance Choices and Decisions

Nonprofit insurance markets offer a lot of options around their auto coverage.  It would take a month of posts to exhaustively cover the topic.

Here are some of the main choices you’ll have to make.

Liability Limits

As noted above, I recommend at least $1,000,000 (you can add an umbrella policy to give you even more coverage). Your state’s minimum limits vary, but most nonprofits will carry $1,000,000.

Physical Damage Coverage

Most clients want to cover their vehicles for physical damage. Comprehensive and collision coverage will be necessary for cars that are still under a lease or loan contract. And if a paid for vehicle has any value, most of the time you’ll want to have the coverage in place.

Your deductible will typically be in the $500 to $1,000 range.

Hired and Nonowned Liability

Many of my clients who don’t own vehicles will still carry this liability policy. It provides liability coverage for the nonprofit when an employee or volunteer is driving her own vehicle on behalf of the organization (nonowned liability). It will also provide liability coverage when driving a rented vehicle (hired liability).

This addresses miscellaneous exposures like driving for errands or transporting clients in a vehicle being used for the nonprofit but not technically owned by the nonprofit. This coverage is absolutely vital in my estimation. While the policy is geared to cover the nonprofit, there are policy endorsements that you can add to address the volunteer or employee who is doing the driving.

Other Options

You’ll want to discuss every aspect of your auto liability exposure with your agent. If your nonprofit provides company vehicles to employees, you’ll want to discuss ‘Drive Other Car’ coverage.

If you rent a lot of vehicles, you might want to explore ‘Hired Car Physical Damage’ coverage.

Just make sure you discuss the way you use your vehicles and the resource for any transportation. You’ll want to make sure you’ve covered your bases. 

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Questions? Feel free to drop them in the comments below.

Just Quit It

Quit (Strategically)

Quit (Strategically)

I’ve been diving deep into this idea of strategic quitting.

Today, I got an email regarding a billing issue from one of my clients. While I know I can research and figure out the answer, I also know that I should not do it.

My value is not in looking up billing information. My value is learning insurance coverage and structuring insurance packages to help my clients protect their visions and missions.

Billing information is vital, and can really make or break a client relationship, but there are people much better than I at researching and providing the answers.

Where do you bring the most value?

How can you stop doing the things that hinder you? Even if you can’t stop doing those things now (I get it – some of us don’t have the luxury of a staff or even an assistant), can you at least identify the things you would love to unload as soon as possible?

I recommend walking through Chris Ducker’s ‘Three Lists to Freedom’ exercise. He has literally written the book on freeing oneself up to do ones absolute best work.

His exercise is a great place to start identifying the things you need to quit doing so you can excel at the things that only you can do.

Think through where you bring the most value to your nonprofit. What are some of the key roles that only you can play? What are the core problems that you are the best at solving? Start filtering and quitting the things that do not facilitate your bringing your best value to the table…

What are you doing, right now, that you should stop doing?

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