Non-profit organizations in Hawaiʻi have a mission to serve their cause, uphold donor trust, and operate responsibly. Managing these responsibilities also presents unique risks that require careful preparation. Without adequate non-profit insurance, your non-profit may face financial challenges related to reputation damage, fraud, property loss, and other liabilities.
Regular benchmarking, including annual insurance reviews, helps identify coverage gaps before they lead to costly setbacks. Here, we review the importance of proactive risk management for non-profits in Hawaiʻi and how strategic insurance planning can protect their mission.
What are the Risks of Inadequate Non-profit Insurance?
A single instance of liability can ruin the reputation or deplete the resources of any non-profit organization. However, damage from property theft, employee injuries, cyberattacks, fraud, and more can impact non-profit businesses differently due to their status.
With less budget than a for-profit business, non-profits typically hire non-professional employees or use volunteers to run their operations. In addition to those monetary restraints, many non-profit businesses use outdated computer and software systems, and decline cyber insurance coverage because they are not in a data-centric field. Hackers exploit these situations by stealing employee credentials or accessing outdated security networks to steal valuable donor data.
No matter how a non-profit functions, all payment data is vulnerable to exploitation. Without the right coverage, non-profit businesses can lose donations, their reputations among their donors, and ultimately, their ability to operate. An annual insurance review can help non-profits reduce these and similar financial vulnerabilities.
How Can an Annual Insurance Review Help a Non-profit?
As with other organizations, non-profits benefit from annual insurance reviews; however, non-profits also have unique circumstances that require special consideration. An annual review can reveal areas of insufficient coverage or amounts which increase financial risk; likewise, they can uncover policies or limits that are not beneficial.
By assessing current coverage needs and comparing them to the existing policy, your business can:
Optimize Costs: Annual reviews allow non-profits to measure their new expense profiles and compare them to their premiums. Your organization may be able to save a significant amount of money with an improved insurance package.- Allocate Resources: As a non-profit, you make informed decisions that impact your donors’ trust in your organization. Insurance reviews can help you reallocate your resources more strategically, shedding unneeded insurance coverage while delivering more efficient services.
- Manage Risks: The risks of a non-profit business can be addressed with annual insurance reviews, including performance and expense benchmarking. An experienced insurance team familiar with non-profits in Hawaiʻi can help you customize your insurance products to your current needs and your projected goals in the coming year.
What Areas Should Annual Insurance Reviews Analyze?
These are the top areas that should be covered during the annual insurance review:
- General Liability Coverage: General liability insurance provides coverage for injuries, property damage, theft, and other unexpected incidents. Whether you host large events or operate a retail outlet, regularly reviewing coverage can help minimize exposure to potential risks.
- Workers’ Compensation: Workers’ comp is a legal requirement for non-profit businesses in Hawaiʻi. This insurance covers employees’ medical expenses, lost wages, and more if they are injured during the course of their job. Re-evaluate workers’ comp if your team changed size or you gained new contracts in the last year.
- Cyber Liability: Data theft can lead to significant financial losses for non-profit organizations, which depend on donor confidentiality to sustain operations. Organizations that accept electronic or online donations should regularly assess their cyber liability insurance to ensure adequate protection. All cyber incidents in Hawaiʻi require notification to affected parties which can be costly; cyber insurance covers this and related costs.
- Umbrella Insurance: Providing an extra layer of protection for non-profit organizations, umbrella insurance extends beyond the limits of general liability policies. It can help cover claims related to fundraisers or other hosted events, particularly when standard policies fall short. Since some insurers exclude coverage for events outside of regular operations, reviewing umbrella insurance options can help address potential gaps and prevent costly liabilities.
Reach Out to Hawaii’s Non-Profit Insurance Experts
As with other organizations, non-profits benefit from annual insurance reviews. Regular insurance reviews help non-profits stay financially secure while adapting to emerging risks. Annual reviews provide a proactive approach to identifying gaps and ensuring comprehensive protection.
As a local provider, Atlas Insurance brings nearly a century of experience in guiding Hawaiʻi’s businesses through customized insurance reviews. Even if operations remain unchanged, risks continue to change; revisiting coverage can reveal opportunities to improve cost efficiency and risk management.
Contact our team today to learn how we can review your insurance needs and identify costly coverage gaps before they become a liability.