Claims Don’t Send an Outlook Appointment Request

I’ve been warned that bloggers shouldn’t attempt wit in their headlines. I tried it anyway….

The point of the headline is this: Claims are unpredictable.

If you could anticipate an auto accident, you’d be able to avoid it (we do this all day, but then there’s that time when we get completely blindsided). An accident or claim happens when we least expect it and they often happen because of a situation we couldn’t dream up if we tried.

Pretty sure this guy didn't expect a face full of paint Photo Credit: Stebaneze via Compfight cc

If he only knew that was about to happen… Photo Credit: Stebaneze via Compfight cc

My clients are always completely caught off guard. Even earlier this winter here in Georgia, we had some frozen pipe claims due to temperatures dipping into the single digits. Some of our nonprofit clients took every precaution known to man, yet their pipes still burst.

Another client had roof trusses somehow break apart. We still can’t figure out that one.

Nearly every week, I have a discussion with a client or a potential client around what coverage she or he should buy for a nonprofit. I try to give this advice every time:

Insure what you know, not what you can’t predict.

In other words, identify the operations, people, and things that make up your nonprofit organizations, and don’t try to play Nostradamus and select coverage solely based on the types of losses that you think you might possibly have.

When a client starts saying, ‘But that would never happen to us,’ it means that there’s a possibility that that thing can happen to them.

One of the biggest areas where a nonprofit client hesitates is around abuse and molestation liability. The employees and volunteers are long time friends and trusted helpers. There would never be an issue. But it’s an after school program that works with disadvantaged youth, so the operations of the nonprofit scream for the coverage.

Perhaps nothing will ever happen (it probably won’t). But accusations can fly. And if there’s no coverage for molestation liability, then the insurance company can’t help. If you decide based on ‘likelihood’, then you’re up the creek. If you decide based on the fact that your nonprofit works with youth, then you would have purchased coverage and defense funds would be available.

Claims don’t send a warning flare. They don’t tell you when they are about to rock your world. They just show up, unannounced like that long lost uncle that everyone would prefer stay lost.

Next time you review your coverage and consider where claims come, focus primarily on the operations, people, and things you want to protect.  I promise you’ll breathe a bit easier, even if you’re absolutely positive the claim won’t show up with an unscheduled visit.



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