2025 brings challenges for nonprofit liability insurance options, but solutions exist. Explore trends, key statistics, and how proactive planning can help organizations safeguard their missions.
The liability insurance landscape for nonprofits remains challenging in 2025. This is especially true for nonprofits serving children and families, who continue to face difficulties securing affordable liability coverage. This is leaving both nonprofits and the vulnerable populations they serve at risk.
A key trend is that more carriers are reducing the level of risk they’re willing to take on when offering liability coverage options to a nonprofit, especially foster care agencies. Carriers such as Nonprofit Insurance Alliance are capping the amount of coverage they will provide, while others have completely ceased providing coverage.
Some nonprofits have reported frustration as carriers appear to group them with higher-risk subgroups, such as child welfare agencies, leading to inflated rates. This was highlighted in a Texas Alliance for Children and Families 2024 survey of nonprofit organizations.
This trend persists despite organizations maintaining consistent program sizes and service levels, leaving them with little clarity or justification for rising costs. For smaller nonprofits, these escalating insurance costs pose an existential threat, jeopardizing their ability to deliver essential services.
Praesidium recently surveyed insurance carriers to determine if organizations receiving public accreditation from an external expert for meeting or exceeding best practices in abuse prevention would positively influence their ability to offer sexual and molestation liability coverage. An overwhelming 94% of respondents said “yes.”
Policies alone cannot fully prevent abuse. The nonprofit account team at The Miller Group has seen how the combination of monitoring, supervision, and screening employees and volunteers can make a difference.
On a positive note, more states are showing increased awareness of these issues and have begun proposing protective legislation. For example, Tennessee and Pennsylvania have successfully passed regulations aiming to support foster care agencies. Such measures are critical in areas where state systems heavily influence foster care placements, as the legislative measures provide a level of stability and assurance for nonprofit providers. However, until these efforts gain broader traction, carriers are unlikely to feel confident enough to offer more equitable rates.
While challenges remain, proactive legislative advocacy and strategic planning will be key for nonprofits navigating the 2025 insurance landscape. Collaboration between state governments, insurance carriers, and nonprofit organizations is essential to ensure sustainable operations and equitable coverage solutions moving forward.
Outside of liability coverage, nonprofits can expect coverages to align with broader industry trends highlighted in The Miller Group’s 2025 Property & Casualty Insurance Trends.
