When do nonprofits need workers’ compensation insurance for volunteers?

Do nonprofits need workers’ compensation insurance to cover their volunteers? The answer to that question is complicated because it depends on state workers’ comp laws and the roles that volunteers play in your organization.

Most states won’t require workers’ comp for volunteers. However, you might need this coverage if volunteers have a long-term relationship with your organization (kind of like an unpaid employee).

Regardless of legal requirements, workers’ compensation offers important protection because nonprofits can be liable for injuries their volunteers suffer. Let’s go over this risk in more detail, looking at how volunteer waivers work and what you can do to protect your NPO from volunteer lawsuits.

Say your organization runs a coat drive each year to help children in need get winter coats. One of your volunteers is carrying a box overflowing with puffy winter jackets when he trips down the stairs and breaks his leg in the fall.

Your organization could be sued over injuries like this, paying legal costs as well as medical expenses you may owe the volunteer. Here’s how your insurance can cover it:

General liability insurance can pay for injury lawsuits for short-term volunteers. In the example above, if the injured volunteer was only someone who helped out at your organization from time to time, your legal costs could be covered under this policy.

Workers' compensation insurance can cover injury lawsuits from long-term volunteers. Many NPOs have volunteers that work for them much in the same way an employee would work for an employer. Say you run an after-school mentoring program. If you use the same tutors for years, you might need workers’ comp insurance in order to cover their injuries. Insurance companies view these long-term relationships like employee-employer relationships, so you’ll need workers’ comp.

As we saw above, your insurance needs depend on whether your volunteers are long-term or short-term and your state laws. But state laws can get tricky.

According to PropertyCasulty360, some states’ laws may not actually allow you to have workers' comp coverage for volunteers. In these states, workers’ comp is only for employees and not for volunteers. So how do you know if your risks are covered? 

The simplest way to sort out your nonprofit insurance is to work with insurance agents that know the nonprofit world. Because Insureon’s agents can customize insurance policies for NPOs, it won’t matter if you run an after-school program, high-adventure camp, or a church group – our agents will be build a policy that fits your organization.

Volunteer waivers can prevent lawsuits, but many waivers simply won’t hold up in court. If a volunteer sues you over an injury, a judge may say that your waiver was too broad or you should have done more to prevent the injury.

So what good are volunteer waivers? Actually, even though waivers might not hold up in court, they are important because they outline the risks involved with your specific volunteer work and explain what your expectations are for volunteers or list necessary safety precautions.

While waivers won’t be able to stop some lawsuits, you should make all volunteers sign one. At the very least, doing so will give you a moment to talk face-to-face with new volunteers about safety. That simple reminder can set the tone to establish a safe working environment.

Complete Insureon’s easy online application today to compare insurance quotes from top-rated U.S. carriers. Once you find the right policy for your small business, you can begin coverage in less than 24 hours.