This is typically the “core” coverage for a nonprofit. We provide this on an “occurrence” policy, not a “claims-made” policy. Depending on the extent of the General Liability coverage purchased, Commercial General Liability insurance may provide coverage for a wide range of negligent acts which result in bodily injury, property damage, personal injury or advertising injury to a third party.
Enhanced Coverage of Nonprofits OWN General Liability Coverage
Summary of key features only. Actual policy language will differ.
- No deductible (Standard)
- Blanket Additional Insureds includes landlords, permits, mortgagees, volunteers, funders, lessors of leased equipment and charitable institutions.
- Special Events included – additional charge may apply for certain events
- Medical Payments Limit $20,000. An increase over the $5,000 or $10,000 limits commonly offered.
From the Claim’s Files
Slip and Fall:
A nonprofit provides janitorial work opportunities to functional disabled clients. On one occasion, a client forgot to put out warning cones while mopping an office floor and the claimant slipped and fell on her way to a restroom. She suffered a torn ligament in her right knee and a right wrist sprain. The nonprofit had the right protocols in place, which included the use of warning cones, but the client simply forgot to use them. The claim was settled at mediation for $50,000. Legal expenses were more than $17,000.
Wrongful Eviction:
A nonprofit runs a transitional housing program for clients recovering from alcohol or substance abuse. The clients are required to pay subsidized rent and actively participate in the recovery programs. One client was not doing either, so with the approval of its legal counsel, the nonprofit had the client removed. The client, acting as his own attorney, filed suit in both Federal and State courts, claiming $10 million in emotional distress. The case went to a jury, and based on the nonprofit’s clear records and a subsequent compliance finding by the funding agency, we obtained a defense verdict. However, legal costs were more than $95,000.
Negligent Supervision:
A nonprofit had an annual event that included a zip line for children, which ran from hay bales stacked eight feet high down to the ground. It was supervised by a volunteer who, against his better judgment, allowed a 12 year-old girl, who was very anxious and fearful, to ride. She fell off as soon as she left the hay bales and suffered a leg fracture that had to be surgically repaired. Concluding that liability was adverse to the nonprofit, we negotiated a structured settlement with the family’s attorney that provided for future medical care, pain and suffering, and attorney fees. The loss cost was $60,000 and the expense was minimal.