Volunteers bring a lot of value to NH non-profits and the organizations they work with. They can help an organization achieve its mission. However, many of our commercial clients find themselves asking; Does workers compensation insurance cover our volunteers?
In most states, workers’ compensation insurance doesn’t cover volunteers, and a company’s general liability insurance may not either. Typically, volunteers are only covered by their own health insurance. This is why it’s essential to understand what your commercial policies cover, so you are aware when you may be exposing your organization to risk.
What qualifies as a volunteer?
In general, a volunteer is a person who provides services for a company or organization on their own volition. They do not receive or expect payment or payment in kind (PIK) for their services. Normally, volunteers are not paid by the organizations they work with. But, some organizations pay their volunteers a nominal fee.
Organizations that do not pay their volunteers must also check to ensure they do not provide any benefits to them either. Payment doesn’t just refer to money exchanges. It can be PIK, which may include providing meals or discounts for items or services. Organizations should be aware of their state laws to ensure their volunteers are not considered employees under applicable regulations.
There are different classifications including short- and long-term volunteers. Short-term volunteers are used for an event or project from time to time. Long-term volunteers help run programs for several years.
Coverage for Volunteers?
It’s important to check state laws for requirements surrounding the use of volunteers. New Hampshire’s workers compensation regulations can be found here.
It’s also important to review coverage with insurance providers to understand what workers’ compensation insurance does and doesn’t cover. Some states allow organizations to add volunteers to their insurance plans, especially if they are long-term volunteers.
If an organization’s workers’ compensation insurance doesn’t cover volunteers, the organization should check to see if their general liability insurance will, as some policies may cover volunteer injuries.
Organizations need to determine what coverage they have for their volunteers as well as the risks they are taking on if they don’t have coverage.
It’s commonly thought that if a volunteer is injured while volunteering and the organization doesn’t have insurance coverage for volunteers, the volunteer’s personal insurance will cover their injuries. While this is likely true, it doesn’t mean the organization will be let off the hook. A volunteer’s personal insurance may try to recoup injury costs via a lawsuit. While there is a Federal Volunteer Protection Act, it only provides protection to nonprofits and government entities. Some states do have volunteer protection laws. The employer should determine if their state provides any similar protection laws for their volunteers.
If an organization can’t find insurance coverage for volunteers but they heavily rely upon them for work, programs or activities, it’s in the employer’s best interest to compare the financial benefit of volunteers to the financial and legal risks that could stem from an injury to a volunteer.
How to Protect Your Organization
Organizations can check with their insurance provider to determine if they can be covered under a volunteer accident policy. Alternatively, organizations can check with the insurance company to see if volunteers can be covered under their general liability coverage. If this is not an option, the organization can limit the risk of using volunteers by requiring the volunteers to sign a waiver. This can help prevent any potential lawsuits that may arise from an injury that the volunteer’s personal health insurance has to cover as they assumed the risk. This can help take some of the burden off the organization should an injury or issue arise.
At the end of the day, organizations need to weigh the risk of using volunteers when workers’ compensation insurance doesn’t cover them.
Contact us to discuss your workers’ compensation needs.