You Cannot Prepare for Everything

My face was torn up with poison ivy. I helped a friend remove a tree that had fallen into his backyard, knocking out a few panels of his fence. About half-way through, I noticed the three leaves of death.

The main tree (a pine) was wrapped tightly within three huge, woody trunk-like vines. Those vines were poison ivy. I had long sleeves, long pants, gloves, and a pair of work boots on, but unfortunately, I didn’t wear a ski mask.

Poison Ivy via Morguefile

 

What does this have to do with insurance and risk management for nonprofits?

No matter how careful you are, there is always the chance something bad can make its way through your air-tight defenses.

The most diligent risk management program cannot control every contingency.  I had every piece of clothing imaginable in the middle of an Atlanta summer, yet still some of that evil poison ivy oil made its way to my skin.

It’s important to prepare thoroughly, but it’s also good to have a backup plan just in case.

Some examples to get you thinking:

  1. Background Checks for Employees and Volunteers: If you are a child-caring organization and do deep background checks on all your people, you can’t prevent a client or a parent of a client from accusing someone in your organization of abuse or molestation.
  2. Motor Vehicle Record checks and defensive driving: You can offer the most comprehensive driver training plan, but distractions come, regardless, especially if your driver is responsible for transporting teenagers.
  3. Burglar and fire alarms with video monitoring: We all know criminals are smart and fires and windstorms could care less

Most nonprofit managers understand the need for insurance and the need for solid risk management and understand that they work together, hand in glove, to protect the nonprofit and its mission.

Insurance is for that stuff that catches you on the blindside, the things  that makes their way through all of your wise defenses.

It’s the inadvertent Facebook post by an employee that reveals private information.

It’s the long-trusted bookkeeper who had been skimming ever so little off the top for the past 8 years.

It’s the accusation by a client or former employee that is totally unfounded.

It’s the outside chance you accidentally did fail to live up to your fiduciary duties.

Coverage is Good. The Right Coverage is Better

While most executive directors and nonprofit boards understand insurance is important, they sometimes are unclear on what the right coverages are.

For instance, I might get a call from an after-school program. They are trying to rent a little space in a church, and the church has asked that they carry general liability insurance. But is a simple general liability policy for an after-school program the right coverage?

Often, the general liability policy will exclude coverage for abuse and molestation and professional liability (among other things). I understand budget constraints, but it is still important to ask the questions:

  1. Who do I need to cover?
  2. What things do I need to cover?
  3. What events or claim occurrences am I concerned about?
  4. What policies will cover the people and things for as many contingencies as possible?

Neither you nor I know when a monsoon will blow through. We don’t know when a relationship with a client will go sideways.

We can do the equivalent of working in the yard with long pants, long sleeves, hat, boots, and work gloves as far as risk management is concerned, but in the end, we can’t physically prevent every possible thing from occurring.

I suggest you view your insurance agent as one of your trusted business consultants – on par with your accountant or attorney (while often not quite as educated, they might be able to deliver a large check). Pummel him or her with questions until you’re satisfied.

**Please note that the post here is general and you should consult with your insurance professional regarding the information contained here. All circumstances and exposures vary greatly and should be considered on an individual basis.
**If I had permission, I’d show you a picture of my friend who I helped. His arms were downright leprous with poison ivy.

Comments

  1. Jim Martell says:

    GREAT post!

    Feel so bad for you. I get poison ivy just by thinking about it. I bet the photo above gave it to me just now. I’ve avoided major outbreaks for just over 2 years now…knocking on wood. Just not wood wrapped in vines. 😉

    Get better soon, friend. Domeboro solution poultices might help.

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