If you operate an animal shelter, you know that the animals depend on you for safety and survival. You need to protect yourself and your organization from catastrophic losses and lawsuits so you can continue to operate and protect the animals in your care.
Most animal shelters operate as nonprofit organizations. These organizations typically have a mission to serve the greater good. They also have to operate like any normal business, which includes identifying risks and finding protection from unforeseen events.
If you operate an animal shelter, you must address the wide variety of risks that you face if you want your mission to succeed. Animal shelter insurance is one way to protect your organization from financial disaster. And while you may think you need only minimal coverage, you probably need more business insurance than you think.
An independent insurance agent can help you get the animal shelter insurance you need.
Why Do You Need Animal Shelter Insurance?
Animal shelters provide care and shelter for lost, abandoned, and surrendered dogs and cats. You are likely to employ full- or part-time workers as well as volunteers. Working with and housing animals while also engaging with the public exposes your organization to a lot of potential risks.
From property damage to personal injuries and community events gone wrong, animal shelters can be held liable for damage, and that damage and resulting lawsuits can be financially devastating. If someone visiting your shelter is bitten by a dog, or even if someone just trips and falls over a misplaced leash or tie-up, you’ll have a costly problem on your hands.
The best way to safeguard the animals in your care and your mission, as well as to protect your clients, staff, and volunteers, is to purchase animal shelter insurance that protects your assets and allows you to continue to operate when problems arise.
What Does General Liability Insurance Cover?
A basic animal shelter insurance plan will include commercial general liability insurance to protect from lawsuits.
Commercial general liability (CGL) insurance is essential for any business, and especially for any business or organization that regularly associates with the general public, on or off its premises. CGL insurance protects your animal shelter from lawsuits related to third-party bodily injury or property damage. This can be as simple as a slip, trip, or fall at your office, or as serious as a dog biting a visiting child.
If such an incident occurs, your CGL policy pays for medical expenses, costs to repair or replace damaged property, attorney fees, court costs, and any settlements or judgments that you must pay. CGL insurance also covers certain personal injury claims (slander and libel) and advertising liability claims.
Special events such as fundraisers, auctions, and adoption events probably play a big role in promoting your animal shelter and raising the funds you need to operate. But does your general liability insurance policy provide all the coverage you need?
Many special events involve renting space and inviting people to participate. They also often involve serving alcohol and participating in athletic activities and other high-risk activities like bounce houses, carnival rides, or swimming. If someone is injured or property is damaged at one of these vents, your CGL policy might not provide the coverage you need.
Some general liability policies exclude coverage for special events. If your policy has such an exclusion, you need special event insurance, which is extra coverage for a one-time event or a series of events, depending on your needs. These policies often include liquor liability coverage, which protects you in the event that there is an alcohol-related injury or property damage.
It’s also especially important to note that many general liability policies specifically exclude coverage for events or incidents involving animals. Your animal shelter liability insurance must include coverage for property damage or injuries caused by the animals in your care. You need to work closely with your independent insurance agent to find the tailored coverage you need for your unique organization.
What Does Commercial Property Insurance Cover?
Commercial property insurance covers your building and the contents of your animal shelter in case of fire and other named perils, such as severe weather, theft, and vandalism. If you own a building, then your property insurance should cover the cost of both rebuilding the physical structure and also replacing its contents, including fixtures, carpeting, cages, medical supplies, grooming tables, and computers.
Your property policy may also include business interruption coverage, which provides income replacement and reimburses you for certain ongoing expenses (salaries, rent) if you must close or relocate temporarily after a covered loss (e.g., a fire).
Don’t Miss Important Liability Coverage for Your Directors and Officers
Nonprofit organizations like animal shelters typically have controlling members or boards. They may employ paid staff as well as unpaid volunteers. Board members may be unpaid or receive a small fee for their services.
Lawsuits are probably the greatest risk for any nonprofit. And while your CGL policy offers broad coverage that protects against a wide variety of potential lawsuits, you may be exposed to other types of lawsuits that it does not cover.
The directors and officers who serve your animal shelter must maintain the organization’s financial stability and provide the appropriate resources and environment in order for it to flourish. But nearly any decision that your board makes can trigger a lawsuit, which can hurt the animal shelter and threaten the directors’ and officers’ personal assets.
Nonprofit directors and officers (D&O) liability insurance protects the assets of individual directors and officers, employees, and your animal shelter from certain allegations. Policies vary by insurance company, but in general D&O policies provide coverage if you are sued for:
- Civil rights violations
- Conflicts of interest
- Statute violations
- Violation of by-laws
- Breach of contract or fiduciary duty
- Financial mismanagement
- Mistakes or errors of judgment
D&O liability insurance pays for your defense costs, damages, settlements, and judgments related to a covered complaint. It is generally customized for the organization and the type of work that you do.
D&O liability insurance protects the assets of your directors and officers, as well as their spouses, domestic partners, heirs, and estates.
You may also want to purchase employment practices liability insurance. This policy offers coverage for claims of employment-related discrimination by prospective, current, or former employees. Your D&O policy may specifically exclude coverage for these kinds of claims, so be sure to know what is covered (and what is not) by both policies.
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Why Do You Need Professional Liability Insurance for Your Animal Shelter?
Animal shelters might also need professional liability insurance, or errors and omissions insurance. This is tailored liability coverage that protects you if a client claims you have been negligent in providing professional services. For example:
- Work mistakes or oversights
- Failure to provide promised services
- Allegations of negligence
Regardless of whether you are at fault, you will still need to pay for your legal defense. Animal shelter professional liability insurance will help with those costs, as well as any settlements or judgments that you are required to pay.
Talk with your independent insurance agent about how to obtain the right amount of professional liability coverage for your needs.
Protect Your Employees with Workers’ Compensation Insurance
Your animal shelter is likely to have employees just like any other business. If so, you need workers' compensation insurance to protect your employees from workplace injuries and illnesses. Workers’ compensation insurance covers medical expenses and provides income replacement if an employee is injured on the job.
Many animal shelters use volunteer workers to perform a wide variety of tasks. Each state has different workers’ compensation laws, and they vary on whether volunteers may, or must, be covered by workers’ compensation insurance. In states where volunteers may not be covered by workers’ compensation, or where it is optional, animal shelters may choose to purchase special accident medical reimbursement policies to cover incidents where volunteers are injured while working on their behalf.
An independent agent who specializes in workers’ compensation insurance can help you determine how to best protect your volunteer workers.
What Other Insurance Policies Do Animal Shelters Need?
You are likely to need several other insurance policies to protect your animal shelter, depending on the types of services you provide and activities that you do.
- Commercial auto insurance covers any vehicles owned by your animal shelter. It offers liability insurance in case you or one of your employees causes an accident while driving a company-owned vehicle. It can also include collision, comprehensive, and rental or towing coverage, just like your personal auto policy. If your employees or volunteers use their personal cars to do work for your animal shelter, then you should consider non-owned auto liability insurance to cover them while they are driving for business purposes.
- Commercial umbrella insurance extends the liability limits of your general liability policy, D&O policy, and commercial auto policy. If a claim exceeds the limits of one of these policies, the umbrella policy kicks in and covers the excess damages, up to the policy limits.
- Animal bailee’s coverage is insurance designed for businesses that temporarily take possession of other people’s pets, with the expectation that they will be returned unharmed. You may or may not need this coverage depending upon the types of animals you take in and the ownership arrangements.
How Much Does Animal Shelter Insurance Cost?
Several factors impact your animal shelter insurance costs, including:
- The services you offer
- The value of your commercial property, including any buildings and their contents
- The location of your animal shelter
- The number of employees and volunteers
The types and amounts of coverage that you need to adequately protect your interests will also play a role in your cost for animal shelter insurance. An independent insurance agent can help you determine the coverage you need and can find you policies that fit your budget.
Benefits of an Independent Insurance Agent
Independent insurance agents simplify the search process for finding the right animal shelter insurance. They’ll walk you through some handpicked policy options and explain the details.
Most importantly, they’ll be there for you when claim time comes. They know the ins and outs of the process and will make sure your claim is handled appropriately.
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The Lowdown on Online Quotes
Online quotes can be tempting. They are fast and easy to get—but are they accurate? And are you getting quotes for the right coverage? For business owners, choosing speed over accuracy can cost you.
Online quotes can’t and don’t see the whole picture. They can leave out important coverage that will leave you devastated if something unexpected happens. And they can leave out cost-saving opportunities that an agent can help you take advantage of.
Instead of getting an online quote, find an independent insurance agent now, and get one-on-one consultation and affordable options for the best coverage for your unique needs.
TrustedChoice.com Article | Reviewed by Paul Martin
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Insurance Expert, Paul Martin