How Nonprofit Organizations Can Reduce Insurance Premiums AND Maximize Coverage

For nonprofits operating on tight budgets, reducing insurance premiums without compromising coverage is a priority. Fortunately, there are several strategies to help your nonprofit achieve this balance.  

1. Bundle Policies One effective way to reduce premiums is by bundling insurance policies. Many insurers offer package deals, such as combining general liability, property insurance, and directors and officers (D&O) insurance with one carrier. This can provide essential coverage at a reduced rate compared to purchasing each policy separately. 

2. Increase Deductibles Raising your deductible—the amount you pay out of pocket before your insurance kicks in—can lower your premium. While this means your nonprofit will  pay forsmaller claims, the higher deductible reduces annual insurance costs. Just ensure that your organization can afford the deductible in case of a loss.   

3. Implement Risk Management Practices Insurance premiums are often tied to the potential exposures and perceived risk of your nonprofit. By adopting strong risk management practices, such as implementing safety protocols, volunteer training, and cybersecurity measures, you can demonstrate to insurers that your organization is less risky, potentially leading to lower premiums.  

4. Review Coverage Annually By regularly reviewing your policies, you will identify areas where you may be over-insured or under-insured. If your nonprofit’s activities or assets have changed, adjust coverage accordingly to ensure you are not paying for insurance you no longer need. 

By following these steps, you can manage the insurance costs of your nonprofit more effectively while ensuring that you have the necessary protection to safeguard your mission. 

Allison Hammons, CIC, CPIW, is a risk consultant for Knight Insurance Group  

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