Whether you are a chamber of commerce, minority bar association or other small association, there are some essential insurance coverages you need to get your entity functioning and your risks low.
Directors and officers coverage is the minimum insurance coverage needed for trade associations. Many boards of these entities are run by member volunteers who, without directors and officers insurance, will put their personal assets at risk should there be a claim against them related to their duties with the entity. In addition to being a protection for those volunteer directors and officers, directors and officers coverage protects member assets from being depleted in the event of a claim or lawsuit which alleges wrongdoing on the part of the directors and officers. This insurance coverage is normally placed at a standard minimum of 1,000,000 per occurrence/aggregate and with a deductible between 1,000 and 5,000. Your entity will need to provide financial information and complete and sign an application in order to obtain this insurance coverage.
When your trade association throws its annual fundraising event, you may want to purchase a separate stand alone event coverage policy. However, your best strategy is to purchase a general liability policy from a company like Hartford/Aon or Philadelphia which will include either scheduled or broad events coverage. Most event locations will require that you have at least 1,000,000 per occurrence 2,000,000 aggregate limits and that they be added to your policy as an additional insured during the setup/breakdown as well as the actual event. If volunteers from the entity will be handling liquor you will want to be sure that you have host liquor liability coverage included in either of these insurance policies.
For smaller trade associations that have no actual offices the two insurance coverages above will be sufficient. However, if an office is rented, or if your trade association maintains a large amount of inventory/supplies, then property coverages should also be included. Very often alumni associations have paraphernalia that they carry to college fairs and the like. The mistake made is purchasing property insurance coverage but not ensuring that insurance also covers money and property away from premises and in transit. When you purchase property coverage you will be required to provide an address. The address used should be the location where the majority of property is stored the majority of time. If there is an insurance claim, the coverage will first respond to damage to the property that was at the location on the policy. If the location is not at the property when damaged, the entity may be at risk for a claim denial. so adding both money and property away from premises ensures that the coverage follows the property while in an auto and while at events/meeting away from the location where stored.
Depending on the entity, other insurance coverage such as hired and non-owned auto and crime coverage may be necessary. However, for most trade associations the three coverages above are most essential. For a free risk management review of the specific risk exposures faced by your trade association, please contact Insurance Design & Placement, Inc. With a cadre of insurance carriers with strong appetite for trade associations and decades of experience serving on association boards, Insurance Design & Placement, Inc. is the best choice for your trade association insurance needs.