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Does our nonprofit need insurance?

This is another question I’m often asked in the early stages, as a nonprofit board is coming together, and the answer this time is, “It depends, but probably.”

A primary responsibility of a nonprofit board of directors is assessing and managing the nonprofit’s risk. Risk is anything that threatens the nonprofit’s mission and stability; that is, what can go wrong? Risk ranges from financial (will we have enough money do what we need to do? Where will the money come from? What if the money doesn’t come in at all?) to mission implementation (Can we hire enough good people? We work children—what might go wrong?) to potential crises and catastrophes (We just rented space—what if someone falls? What if there’s a hurricane/tornado/earthquake?) A thorough risk assessment methodically asks all these questions about all aspects of the nonprofit’s operations.

As a nonprofit is starting, the board can begin to look at the bigger picture of the nonprofit’s risk. What risks does this nonprofit face right now? A year from now? The nonprofit will need a plan to manage its risk, and insurance is just one part of that plan. In this initial stage, it may be impossible to assess all the nonprofit’s risks, since risk will change over time as the nonprofit adds or changes programs; accordingly, a risk management plan will change over time as well.

Once the nonprofit’s risks are identified, the board can begin to pinpoint ways of addressing these risks.  A variety of approaches are available–not everything requires insurance. Indeed, some risks are not even insurable.

Insurable risks include loss of assets, injury, interruption of service, litigation.  Uninsurable risks include loss of audience or membership, loss of funding, social or scientific changes that eliminate the need for a service (e.g., March of Dimes), increased competition.

Some risks can be mitigated through preventative measures. Safety procedures are a good example—ensuring fire extinguishers are handy; eradicating trip hazards.

Once the board has assessed its risk, it must also assess the nonprofit’s tolerance for risk. In other words, does the nonprofit have the capacity to deal with a risk should it occur? For example, can it pay for the costs of storm damage?  Can it afford to deal with a lawsuit?  With these assessments, the board  can begin to develop a plan to address risk, using mitigation as much as possible and practicable, developing an emergency fund, and purchasing insurance.  At this point, consultation with an insurance agent knowledgeable about nonprofit organizations will be most helpful.

A helpful article from Blue Avocado is available here, and the Nonprofit Risk Management Center has many resources.

Thinking of Starting a Nonprofit?

Wednesday, April 13,  6:00 – 8:00 pm

Do you have a great idea that will help your community? Maybe it should be a nonprofit! We’ll discuss the difference between nonprofits & for-profits, some preliminary considerations before you take action, and an overview of the steps in the process of getting a nonprofit up and running, with a quick look at getting tax-exempt status. Join us at the Legal Center for Nonprofits, located inside the Inter-Church Council House at 412 County Street, New Bedford, MA. Cost to attend is $10 per person. Pre-registration is recommended. Call (508) 264-5996 or email to for more information or to pre-register.


Nonprofits Must Manage Risk

Nonprofit boards of directors are responsible for risk management in their organizations. Larger nonprofits may have staff to carry out the risk management function, but for most small nonprofits, this falls to the board of directors, with the assistance of the executive director if there is one.

What is risk?

At its simplest, “risk” means “the possibility or chance of loss, danger or injury”. Risk generally involves harm of some type along with uncertainty. To manage risk, the board must identify:

  • What can go wrong?
  • Can it be prevented?
  • Can we insure against it?

Some sources of risk include:

  • Program, such as providing professional, such as counseling or child care, or other services, classes (art, music, cooking), etc.
  • Accidents, slip-and-fall, motor vehicles; transporting students, etc.
  • Acts and omissions, such as failure to warn of a danger, defamation, failing to perform an act or service, etc.
  • Breaches of duty, particularly with regard to board members’ fiduciary duties.
  • Employment, such as discrimination, wrongful discharge, other personnel actions. (Most claims against nonprofits derive from employment matters.)
  • Finances, such as mishandling or misappropriation of funds.
  • People, volunteers, clients, contractors, the public, etc.
  • Disasters, natural or otherwise.

Insurable risks include:

  • Loss of assets
  • Injury
  • Interruption of service
  • Litigation

Unininsurable risks include:

  • Loss of audience or membership.
  • Loss of funding, such as cuts to state budget, or termination of a grant.
  • Social or scientific changes that eliminate the need for a service (e.g., March of Dimes).
  • Increased competition.

A key component of every nonprofit’s risk management program is insurance. Join us for a presentation by Jeffrey Pelletier, Commercial Account Executive with the Sylvia Group, as he explains the particular insurance needs of nonprofits on Wednesday, February 24, at 6:00 pm, at the Legal Center for Nonprofits, located inside the Inter-Church Council House at 412 County Street, New Bedford, MA. Cost to attend is $10 per person. Pre-registration is recommended. Call (508) 264-5996 or email to for more information or to pre-register.


Customized Board Training Available

Does your Board of Directors need a refresher on tax-exempt/nonprofit topics like fiduciary duties, the role & responsibilities of boards, best practices for board meetings, or another topic of particular interest to your nonprofit organization?

Contact us for more information about affordable customized trainings for your board delivered at your location.

Popular program returns

Board Meeting Basics
November 18, 6:00-7:30 pm

“Are all nonprofit boards like this?”

“Is our board typical?”

“Is this how a nonprofit board is supposed to run?”

“What about Robert’s Rules?”

Find out about best practices for boards of directors of small nonprofits at the next program of the Legal Center for Nonprofits, Board Meeting Basics, on Wednesday evening, November 18, at 6:00 pm.

Admission is $10 per person, payable at the door. Off-street parking is available. The Legal Center for Nonprofits is located inside the Inter-Church Council House, 412 County St, New Bedford. Call (508) 264-5996 or email for more information or to preregister.



Top 10 Tips for End-of-the-Year Fundraising

Wednesday, November 4 at 6:00-8:00 pm

Lee Blake and Kristen Sarkarati will offer their Top 10 Tips to maximize your fundraising results as we head into the end-of-the-year fundraising season. Find out how to get the best return on your fundraising strategies for this year’s Giving Tuesday (December 1), polish your Annual Appeal to make it better than ever, plus more ideas to capitalize on the generous spirit of the fast-approaching holiday season.

Lee Blake is well known for her work with many local nonprofit organizations, including the New Bedford Historical Society and the New Bedford Education Foundation. She is an experienced board member and grant-writer. Kristen Sarkarati is the owner of Blue Skies Consulting, specializing in fundraising and communications, where she has crafted dozens of highly successful annual appeals over the years for a variety of non-profit organizations. Both are members of the Board of Directors of the Legal Center for Nonprofits, Inc.

Admission is $10 per person. Program takes place at the Legal Center for Nonprofits, Inc., 412 County Street, New Bedford, MA, located inside the Inter-Church Council house. Off-street parking is available. Pre-registration is encouraged as space is limited. For more information or to pre-register, call (508) 264-5996 or email

Annual Reports due to MA Secretary of State

November 1 is the deadline for nonprofit corporations operating in Massachusetts to provide annual reports to the Massachusetts Secretary of the Commonwealth.  The Annual Report filing fee is $15 and checks should be payable to the Commonwealth of Massachusetts.  Download a fillable PDF Annual Report form here.

Organizations that fail to file annual reports for two consecutive years are at risk of having their corporate status revoked by the Secretary’s office.  Reinstating corporate status can be expensive in terms of both money and time, as reinstatement requires the filing of all owed annual reports, along with their filing fees.

The Annual Report form is straightforward.  You must provide the physical address of the nonprofit corporation, the date of the last annual meeting, and the names and residential addresses of the officers and board of directors; if there are too many for the space provided, you can add a second sheet listing the entire board. The expiration date for terms of office (depending on your bylaws, it may be the next annual meeting date) should also be listed.

Nonprofit corporations must have a President, Treasurer, and Secretary (Clerk).  If an officer position is vacant, someone should be appointed to the position in accordance with the organization’s bylaws. If an officer position is blank on the form when submitted, it may be returned to you as incomplete.

The Annual Report may be signed by any officer, but the officer’s name must appear as an officer on the report.


Introducing the Nonprofit World

Wednesday, September 23, 6:00-8:00 pm, 

at the Legal Center for Nonprofits

Feeling entrepreneurial? Do you have an idea to start something? Maybe it’s a nonprofit? Distinct differences separate the for-profit and nonprofit worlds, and it isn’t the lack of a profit that makes the determination.

In this new, free program from the Legal Center for Nonprofits, we will look at what distinguishes the nonprofit organization from the for-profit, how to tell if your idea is suited to a nonprofit, and we will give you on an overview of what it means to be nonprofit. Join us on Wednesday, September 23, at 6:00 pm, at 412 County Street, New Bedford. No cost to attend but pre-registration is recommended. Call (508) 264-5996 or email to for more information or to pre-register.

September Programs!

Nonprofit Advocacy Basics
Wednesday, September 16, 6:00-8:00 pm, $10

Is your nonprofit involved in advocacy? Should it be? Learn to distinguish lobbying, issues advocacy, and political activity, and find out what a 501(c)(3) organization can do.

Introduction to Nonprofits
Wednesday, September 23, 6:00-8:00 pm, FREE

Are you thinking of starting a nonprofit? This overview will give you a sense of the sector and what it takes to start a nonprofit.

Board Expectations – Wednesday, September 30, 6:00-8:00 pm, $10

Have you been invited to join a nonprofit Board of Directors? What does a nonprofit expect of its Board members? Bring your questions about Board service.

Please pre-register for programs as seating is limited.

All programs are held at the Legal Center for Nonprofits, Inc., 412 County St., New Bedford, MA, inside the Inter-Church Council house. Off-street parking is available next to and behind the building. For information and to pre-register, please call Linnea Michel at (508) 264-5996, or email to, or visit

Our Programs are supported by a grant from

the Island Foundation

Volunteers Needed!

The Legal Center for Nonprofits is seeking volunteers to assist with various aspects of our program.  If you think that helping LCN serve the nonprofit community would be satisfying work, please consider applying.

Volunteers can serve in various roles. For example, volunteers may assist with program planning or coordination, fundraising, clerical and general office work. Law students or recent law school grads can gain a deeper understanding of nonprofit law along with experience working with nonprofit clients.

To apply for a volunteer position, please complete and submit our Volunteer Application by email to, or by postal mail to Legal Center for Nonprofits, 412 County St., New Bedford, MA 02740.