When it comes to insurance, individuals and nonprofits aren’t all that different. Both might have tight budgets and both can face risks and liabilities that can threaten their assets. In addition, both might unintentionally make insurance mistakes that can leave them exposed to losses. Understanding and avoiding these mistakes can help prevent them.
DO: Get It, but DON’T Forget It
Life rarely stands still, so neither should your insurance. However, people often forget to update their policies when something big changes—like a change in marital status, moving to a new place or adding a new family member. Nonprofits do the same when they grow, launch new initiatives or expand. Not telling your insurer about these changes can lead to gaps in coverage. Insurance isn’t a “get it and forget it” purchase. Individuals and nonprofits should both schedule annual coverage reviews to help make sure they have the coverage needed to avoid those gaps.
DO: Help Mitigate Risk
Insurance helps protect your assets in case of unexpected events, but you’re still responsible for deductibles and some costs. Both individuals and nonprofits can reduce risks and insurance expenses by taking steps like implementing safety measures, staff training and background checks. Realize that not all risks can be avoided, so actively mitigating risk is essential.
DON’T: Forget to Cover the Right People
Another common mistake is forgetting to cover the right people. Families might not insure all members who should be covered and nonprofits often overlook volunteers, who are vital to their mission. If something goes wrong it can lead to lawsuits. For nonprofits, a volunteer’s misstep could also damage their reputation.
DO: Get Professional Help
When you buy insurance, it’s tempting to get a one-size-fits-all policy and hope for the best. But whether you’re looking for insurance for yourself or on behalf of a nonprofit, it’s better to find someone who understands your exact needs. Not sharing all the details with your insurance provider or leaving out important info might mean you end up with a policy that doesn’t cover you or claims that are denied. A licensed insurance agent knows what questions to ask to avoid those kinds of coverage gaps.
DON’T: Select Insurance Solely Based on Price
Although cost is an important consideration, opting for the lowest-priced policy may result in inadequate coverage and increased risk. Likewise, the highest-priced option does not necessarily guarantee comprehensive protection either. It’s best to consult with an insurance specialist to assess your specific needs and identify a policy that provides appropriate coverage, regardless of whether it is the most or least expensive.
Insurance isn’t something you can ignore or leave up to chance. Whether you’re covering your family or finding insurance for a nonprofit, keeping your insurer updated and asking the right experts for help are key. Annual reviews and open communication go a long way toward making sure you have the right coverage and keeping your peace of mind. If you’d like to review your personal coverage, contact me. I’d be happy to help!
The product information contained on this website is informational only and not a statement of contract. All coverage options are subject to the provisions of the policy purchased and details of the policyholder’s situation. Not all products are available in all states.
