Insurance Regulators Unaware of Insurance Market Failure for Nonprofits

Insurance regulators need to hear your voice.

Congress can solve nonprofits insurance access issues now. Make sure your nonprofit never faces the stress of searching for insurance again.

The Capitol Building with autumn trees in front of it

The Capitol Building

Before you discovered Nonprofits Insurance Alliance (NIA), you probably experienced the stress that came from not being able to find or afford insurance for your nonprofit. We want to make sure that never happens again to you or any other community-based nonprofit.  A matter raised at a recent hearing in Washington, D.C. would expand insurance options for nonprofits.

The Senate Banking, Housing, and Urban Affairs Committee recently conducted a hearing related to insurance matters.  When questioned by Chairman Sen. Sherrod Brown (D-OH), the representative of the National Association of Insurance Commissioners (NAIC) said they were not aware of nonprofits having trouble getting the insurance they need.

We respectfully disagree, and we think you will, too.

The inability of nonprofits to find and afford liability insurance is directly linked to the shortage of the type of property policy nonprofits need:

  • When commercial carriers are willing to provide insurance to nonprofits, they provide it as a “package,” with property and liability coverage included in one policy form.
  • However, Risk Retention Groups (RRGs) that insure nonprofits (like Alliance of Nonprofits for Insurance, RRG) are limited by law to insuring only the more challenging and difficult liability portion of that “package” policy. They are not allowed to insure property.

Since 2020, there have been more than 20 articles about the insurance crisis facing nonprofits nationwide, in publications such as Insurance Business America (here and here), Law360, Insurance Journal (here and here), Chronicle of Philanthropy, PropertyCasualty360, Rough Notes, LeadersEdge, IVANS Communications,, and even the Wall Street Journal.

More than 3,000 nonprofits have signed letters urging members of Congress to allow nonprofits to resolve this problem via passage of the Nonprofit Property Protection Act (NPPA), which would allow RRGs to provide property insurance to nonprofits — along with the liability insurance RRGs have provided so reliably and affordably for decades.

Dozens of nonprofit associations have already appealed to their state insurance commissioners for help with this issue.

It’s time to acknowledge that, as good as the state-based regulatory system may be, it cannot address market failures like this one facing nonprofits.

Only an act of Congress can do that.

We are grateful that Chairman Brown has turned his attention to this matter.  In the hearing, Chairman Brown described his work to draft an amendment to allow nonprofits to solve this thorny and persistent problem for themselves through their own RRGs and the NAIC agreed to work with him on this matter.

We need your help now to urge the NAIC to honor their commitment to Chairman Brown to help him resolve this issue.

If you want to make your voice heard:

Please fill out the information here, and we will make sure this gets to your state insurance commissioner — and to the leadership at the NAIC.