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Simplified Overview of Basic Insurance to Consider as an Arts Organization
Commercial (Property) Insurance provides coverage for property losses that stem from one of the following: A) Physical damage to property, B) Loss of use of property, C) Criminal activity, D) Business Interruption
Arts Groups frequently have property exposures that involve equipment (fixed equipment & mobile) and/or valuable archives and exhibitions. It is important to determine how potential losses to these properties will affect your operations. Identifying who is responsible for damages and or losses to exhibitions?
Commercial General Liability Insurance (CGL) is designed to offer specific protection against third party claims, i.e., payment is not typically made to the insured, but rather to someone suffering a loss, whom is not a party to the insurance contract.
For example, this type of insurance would cover your organization should a client trip over a loose phone cord in your conference room and break an arm.
Organizations should pay close attention to considering if members need to listed as additional insured.
For example if a film club member causes accidental damages to a property they are filming on, they can be held personally liable. If members are listed as additional insured the liability policy provides coverage for these damages.
The CGL covers four types of injuries:
A) bodily injury that results in actual physical damage B) loss property damage
C) personal injury D) advertising injury
Tenants Legal Liability Insurance (TLL) is usually required for the space you lease that is under your care, custody and control. It is a requirement of most leases and is usually available as part of the CGL .
IMPORTANT: Professional Liability (Errors and Omissions Insurance) coverage is not provided by a Commercial General Liability policy. Commercial General Liability does NOT provide coverage for errors, contract performance disputes or any other Professional Liability issue. CGL policies for Arts Groups frequently exclude C) personal injury & D) advertising injury as it may overlap the professional activities of the organization.
Errors and Omissions, Professional Liability (E & O) Insurance
Professional liability insurance, also commonly referred to as errors & omissions coverage, is the service equivalent to product liability insurance. It protects you financially in the case of a claim against you for negligence, errors, omissions, or wrongful acts in the performance of your duties.
E & O insurance for Arts Organizations offers specialized coverage for a variety of media and professional risks against the devastating impact of lawsuits for libel, slander, invasion of privacy, infringement of copyright and other specified torts.
Directors and Officers Insurance (D&O)
D&O Insurance is frequently requested by potential board members before they will accept board appointments or other elected positions. D&O insurance covers the legal liability of Directors and Officers, arising out of their fiduciary responsibility to exercise due care in managing the organization’s affairs. Should their negligence result in loss to the organization, members, or others, they can be held personally liable.
Accidental Death and Dismemberment Policies, (AD&D)
Accidental Death and Dismemberment is a life insurance product that pays proceeds to your designated beneficiaries if you die or are disabled as a result of injuries caused by a covered accident (not due to an illness).
Some organizations like to provide employer paid (organization paid) benefits to board members and or executive employees. AD&D is sometimes provided for individuals who are going to be traveling on business for that organization, . Some policies have a provision that provides coverage on or off the job, 24 hours a day, 365 days a year, worldwide.
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