Here's how to start a plan for managing risk in your nonprofit — and where to get help

Author: Sara Gibson


All organizations face risk, but it can feel like nonprofits face twice the risk with half the budget. Increased risk can come from serving vulnerable populations, hosting events, using volunteers, and/or operating in areas with increased criminal activity.

With the majority of nonprofits relying on grants and fundraising to operate, they can't pass the costs of losses or increased insurance premiums on to consumers. Every dollar counts, and unexpected costs can mean less money to support your mission.

Thankfully, nonprofits are filled with resilient people who can meet this challenge head on. To do so, it's imperative to be proactive and have an effective risk management plan that includes these steps:

  1. Conduct assessments to identify potential risks.
  2. Evaluate how identified risks can affect your organization.
  3. Develop solutions to control those risks.
  4. Implement the best solutions to address the identified risks.
  5. Monitor for effectiveness.

Who should participate in risk management?

We find organizations have the most success when they adopt a mindset that every member of their organization is a risk manager. Everyone plays a role in reducing risk — from the volunteer coordinator who keeps passwords safe to the office manager who locks up at the end of the day.

What are common solutions for managing risk?

  • Develop policies and procedures to guide staff and volunteers on how to mitigate risks.
  • Train and educate staff. Educating staff/volunteers as to why they're being asked to do something versus just giving them instructions can have a greater impact and empower them —and not once a year, but a documented, routine training that's a part of the standard operating procedures.
  • Establish a safety committee and encourage staff to participate.
  • Transfer risk when you can. If you're hiring a vendor, transfer the risk to them via a written agreement. If you have volunteers and/or participants in a program you're offering, have them sign a liability waiver.
  • Stay ready. Incidents may occur no matter how strong your preventive measures are. Have incident and emergency response plans in place as well as an incident investigation program.
  • If you own buildings, conduct regular hazard identification inspections, and document and follow a preventive maintenance plan.

How do we get started with a risk management plan?

Taking the first steps can seem daunting, but you don't need to start from scratch nor do this alone. Your insurance carriers and Gallagher as your broker/consultant are your partners in risk management. We are here to help — from assessing and identifying risks, to coming up with solutions and helping you implement them.

Most insurance carriers as well as Gallagher have resources and services available to you — at no additional cost — to help implement solutions. Those resources might include learning management systems, webcasts, safety bulletins, and templates for policies and procedures, checklists, forms, waivers and more. At Gallagher, we also have a team of consultants who specialize in nonprofit risk to advise you. Take advantage!

You can learn more about some of Gallagher's risk management offerings here: Loss Control Insurance.

We value being a part of your risk management team. Please don't hesitate to contact your Gallagher representative if you have questions or need assistance.

Author Information


The information contained herein is offered as insurance Industry guidance and provided as an overview of current market risks and available coverages and is intended for discussion purposes only. This publication is not intended to offer legal advice or client-specific risk management advice. Any description of insurance coverages is not meant to interpret specific coverages that your company may already have in place or that may be generally available. General insurance descriptions contained herein do not include complete Insurance policy definitions, terms, and/or conditions, and should not be relied on for coverage interpretation. Actual insurance policies must always be consulted for full coverage details and analysis.

Insurance brokerage and related services to be provided by Arthur J. Gallagher Risk Management Services, Inc. (License No. 0D69293) and/or its affiliate Arthur J. Gallagher & Co. Insurance Brokers of California, Inc. (License No. 0726293).