Due to limited funding, many nonprofit organizations overlook risk management or assign it as a lower priority for fear of it being costly. The reality is, not having a risk management strategy can terminate the operation of your nonprofit organization all together. Understanding the biggest risk management challenges nonprofits face can help you formulate a strategy to ensure your nonprofit organization can weather any storm.
Do you raise funds online? Raising money online exposes nonprofits to a whole host of potential losses. While this is one of the largest risks nonprofits take, it’s the one that is least considered, according to a recent survey of nonprofit risk management programs. Using the internet to raise funds can subject the nonprofit to stolen information protected under the privacy act, security breaches on their networks and even media liability complications. When embarking on such endeavors, risk should be thoroughly evaluated and a plan should be implemented in case of a loss. Comprehensive risk management would include off-site data storage, a business continuity plan, and insurance to cover potential losses.
In addition to fundraising efforts through the internet, there are other major risk management concerns related to the services an organization provides that must be addressed. For instance, if an organization provides afterschool care services and shuttles children from schools to a program site, all drivers should complete a safe driver training. Risks may also come along when an organization decides to offer services that slightly stray from its core mission. While the intent is admirable, as one risk management expert shares, “it completely changes the risk profile of the organization.”
It is critical for nonprofit organizations to develop and implement a risk management plan that comprehensively address all areas of the operation. The insurance brokers at Lamb Financial Group are seasoned experts in providing insurance and risk management services to nonprofits and social services organizations. Our experienced brokers can help you look at the different risks your organization faces, and develop a risk management strategy that addresses your needs. Call us at 866-481-5262 or contact us to learn about developing a comprehensive risk management plan for your organization.