Many volunteers have asked us about insurance. We are all volunteers. Our aim is to help others. I am sure that every one of our hearts is in the right place. However, there is always the possibility that something can go wrong.
We have always heard that ours is a litigious society. We would hope that our members are different, that they understand where we are coming from. Alas, we can’t be sure. We as a nonprofit therefore carry insurance on behalf of our organization and our volunteers.
Here is a description of our insurance.
Nauset Neighbors Insurance Program: Business Auto Coverage.
The “business auto policy,” also called “commercial auto policy,”provides liability coverage. “Non-owned and hired” auto liability coverage is typically the only auto coverage a nonprofit carries if it does not own any vehicles. With respect to liability stemming from automobile accidents, volunteer drivers should understand that when they drive their personal vehicle on Nauset Neighbors’ behalf, the insurance on that vehicle (i.e., usually the volunteer’s personal auto insurance) will respond first in the event of an at-fault accident. The insurance industry expression for this is “the coverage follows the car.”
Nauset Neighbors has a commercial auto policy (non-owned/hired coverage) which will provide excess coverage for those accidents where bodily injury and property damage to others exceeds the limit of the driver’s personal policy, which will always be primary. The property damage is third party property damage, e.g., to a building, a fence, or another car the driver hits. Nauset Neighbors’ policy is $1 million combined single limit.
Commercial General Liability (CGL)
The CGL is designed to cover the liability exposures that are common to all organizations, from large corporations to small non-profits. The policy is a combination of three separate coverages, each with its own insuring agreement and exclusions. The three coverages are:
Coverage A: General Liability (Bodily Injury and Property Damage)
Covers liability for bodily injury and property damage caused by an accident, except for liabilities that are specifically excluded. Exclusions include liabilities more properly covered under a separate policy, such as automobile and workers compensation, and liabilities considered uninsurable. Some of the liabilities covered include: injuries arising from our premises (includes a room temporarily assigned to us), injuries to guests at special events, and damage to property not owned by us or in our possession and not damaged as a result of our mission. Example: if you accidentally knock over a porcelain vase and it is shattered, it is covered. However, if you came to help the member clean it and you dropped it, insurance won’t cover that cost. The occurrence limit is $2 million with an overall policy limit of $2 million.
Coverage B: Personal Injury and Advertising Injury Liability
Personal Injury and Advertising Injury Liability cover a specific group of liabilities that do NOT involve bodily injury or property damage, are not caused by an accident, and therefore are NOT covered under Coverage A.These liabilities are: libel, slander, false arrest, malicious prosecution, wrongful eviction, wrongful entry, violation of privacy, infringement of copyright and unauthorized use of an idea in advertising.
The occurrence limit is $2 million with an overall policy limit of$2 million.
Coverage C: Medical Payments
Medical Payments coverage provides a limited amount of insurance ($5,000 per person) to pay medical expenses for persons (other than Insured’s) injured in accidents that occur on or next to the insured’s premises or as a result of our operations. This coverage is payable regardless of whether the Insured is legally liable, and extends coverage to the injuries of volunteers. Injuries due to automobile accidents and athletic activities are excluded.
American Bar Association Report
A report from the American Bar Association provides a very thorough and technical description of the insurance liability of“Villages.” One particular point states: “Massachusetts caps tort damages at $20,000 for non-profits if a tort was committed in the course of an activity that accomplished the charitable purposes of the organization. ”
 From “The Aging-in-Place Village Concept: Addressing Liability Concerns”published by the American Bar Association, page 9.