Not-for-profit special events can be lucrative from a fundraising standpoint, but they also carry significant risks. Proper insurance coverage can help protect your organization.
Special event, special planning
Risks associated with special events run the gamut from accidents and personal injury, to fraud and theft, to cancellation due to inclement weather or nonappearance by a featured performer. However, it’s possible to buy designated “special events insurance.”
These policies provide coverage for lawsuits and claims brought by a third party who suffered a loss connected to the event. Coverage may include liquor liability coverage that protects your nonprofit against post-event calamities. For example, an auto accident caused by an event guest driving under the influence could be covered.
Cost-effective insurance options
There is a drawback: Special events insurance for a single event generally comes with a high price tag. Depending on the type of event and your current coverage, it might be more cost-effective to obtain coverage by extending one of the following types of insurance policies:
Comprehensive/commercial general liability. CGL insurance provides coverage for claims that allege bodily injury or property damage. It may be possible to extend coverage to members, volunteers, temporary or leased workers, co-sponsoring organizations, outside sponsors, and board members.
Directors and officers liability. D&O insurance covers claims arising from the management or governance of an organization and can include coverage for board members and executives.
Nonowned/hired automobile liability. You may need this coverage if volunteers or staff will use their own vehicles during the event. You may also need this coverage if you rent or hire cars such as limousines.
Fidelity. Fidelity bonds guard against the loss of money or property due to dishonest acts of staff or volunteers.
Weather. Weather insurance provides coverage for losses resulting from weather-related event cancellations and is particularly important for outdoor events.
Nonappearance/cancellation. This insurance protects against losses that result when a featured guest fails to appear.
Check with your insurer
You may already have some of this coverage under your current policies. But check with your insurer to learn whether your special event will be covered. If it is not covered, see whether you could pay a one-time additional premium for protection. Contact us for more information on managing risk.
