Every rescue group should carry insurance to protect the organization, its individual board and staff members and its volunteers.
General liability insurance is important to carry as it will cover claims for bodily injury or property damage to people not associated with your organization. This ensures that your organization is covered if, depending on the policy, a customer falls on a wet floor during an adoption event, a volunteer transporting a pet to its new home has a car accident and injures the other driver, or a cat bites a potential adopter. Additionally, you need to purchase workman’s compensation if your organization has paid staff, and possibly property insurance if your rescue has its own facility. You can also buy insurance to cover medical costs for your volunteers and fosters who are injured while performing tasks for your organization.
Although forming a corporate entity protects individuals from personal liability for any corporate wrongdoing, directors and officers of a board can still be personally sued for reasons such as misuse of company funds, fraud, violating the law, gross negligence and neglect of legal and financial duties. As such, it is a good idea to purchase director and officer (often called “D&O”) liability insurance to protect corporate directors and officers in the event of a lawsuit. This type of insurance usually covers legal fees, settlements and other costs. Sometimes the D&O insurance will also protect a corporation if it is named as a defendant in a lawsuit.