The most common liability policy purchased by nonprofits is the commercial general liability policy. CGL covers against claims for:
- bodily injury (someone suffered an injury),
- property damage (someone’s property was damaged),
- personal injury (offenses for libel, slander, defamation, or malicious prosecution), and
- advertising injury (libel, slander, or copyright infringement due to advertising activities).
Your nonprofit will be covered for damages that it’s ordered to pay to someone (such as a visitor, customer, supplier, or associate) who is injured on the organization’s property. These kinds of policies don’t apply to the nonprofit’s employees, who are covered separately by workers’ compensation insurance
A $1 million per claim and $1 million in the aggregate limit is the most commonly purchased entry-level limit for a CGL policy. Larger organizations often purchase policies with higher limits.