When the Show Can't Go On: How Showstoppers® Event Cancellation Insurance Protects Your Business

 A recent outbreak of Norovirus at one of Westchester County's largest and most elegant hotels for events and business meetings caused hundreds of illnesses and led to event cancellations for several days.

Workers were forced to stay home, sections of the hotel had to be industrially cleaned, and major revenue-generating events were cancelled. The hotel clearly suffered revenue losses and unforeseen cleanup costs. 

This is the type of situation where Showstoppers® insurance would minimize the financial impact significantly. Showstoppers® offers protection for loss of revenue due to cancellation, abandonment, curtailment, or re-scheduling of your events, with several options. Showstoppers® also pays for losses due to reduced attendance at a continued event—full cancellation of an event may not be required. In the hotel's case, an extra "communicable disease" endorsement, at a modest cost, would have covered the cancelled events. 

Coverage is available for large and small events. The 2012 New York City Marathon, which generates approximately $23 million, was cancelled due to Superstorm Sandy. Marathon organizers, the New York Road Runners Club, have been working to recoup losses based on their event insurance. 

Standard features of Showstoppers® Event Cancellation insurance include:

Adverse Weather

Non-Appearance of a Principal Speaker

Labor Disputes

Earthquake Coverage

Vendor Commitments

Adverse Weather for Golf Outings

Transmission Interruption

Venue Damage

Requisition or Confiscation of the Venue

Remedial Action and Extra Expenses

Penalties for Failure to Vacate

National Mourning

Future Marketing Expenses

Enhanced coverages and features are available for events $125,000 or less, physical loss of personal property, terrorism, and more. Specific terms and conditions vary, depending on the policy and enhanced coverages selected. Rollins Insurance can help you choose the best Event Cancellation Policy for your needs. As peak event season is upon us, you should speak with your Rollins representative to determine the appropriate event cancellation options for your event.  

 

Photo Credit: John K via Photopin cc

 

 

8 Key Risk Management Tips Before You Sign A Contract

You are handed a business contract and told, "Sign here!" Don't do it! Read the contract carefully, following these guidelines of “Do's” from Melanie Lockwood Herman, doing so will avoid problems later. Whether it is a real estate contract, business sale agreement, employment contract, or contract between you and a customer or vendor, you can use these guidelines to avoid problems.

The following is an abbreviated list of contract “do’s.” An expanded list—with accompanying contract “don’ts”—appears in Nonprofit Risk Management's book, EXPOSED: A Legal Field Guide for Nonprofit Executives.

• Do ask for clarification about ANY contract terms you find confusing, inapplicable, vague, or incomprehensible.
• Do insist that inappropriate, irrelevant and nonsensical clauses be removed or fixed before you sign the contract.
• Do make certain you have the authority to enter into a contract before binding your nonprofit.
• Do use a contract every time you retain a consultant or contractor to provide services to your nonprofit. Make certain the independent contractor agreement specifies the contractor’s status, and ineligibility for insurance coverage or any benefits provided to employees.
• Do read every contract presented to you for signature. Remember that the contract binds your nonprofit legally and the contract’s provisions may apply for a number of years, even after the work specified in the contract has been completed. Also remember that you could be held accountable in court for the promises made in the contract.
• Do wait until contract negotiations have concluded and the ink on the contract (both parties’ signatures) has dried before authorizing work to begin on any project that the contract governs.
• Do limit the risk of contracting policy violations by making sure that only those individuals who are authorized to enter into contracts on behalf of the nonprofit do so. Make clear who has authority to negotiate and execute contracts on the organization’s behalf and who does not.
• Do include language in every contract that protects the nonprofit’s assets. For example, indicate who owns what in your contracts with vendors and independent contractors. If an independent contractor is preparing a report for your nonprofit, that report should be the nonprofit’s property.

Melanie Lockwood Herman is Executive Director of the Nonprofit Risk Management Center. She welcomes your ideas about any risk management topic, feedback on this article and questions about the Center’s resources at Melanie@nonprofitrisk.org or (202) 785-3891. The Center provides risk management tools and resources at www.nonprofitrisk.org and offers consulting assistance to organizations unwilling to leave their missions to chance

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4 Budgeting Strategies for Nonprofits

I wanted to share four important budgeting strategies that I came across that will help in your goal to save money and time. These strategies will also help to advancing your mission in these tough financial times.

Typical budget cycles

Many organizations have an annual budgeting cycle, consisting of a “board approved budget”. These often have 3-4 month cycles and are unfortunately not always completed before the beginning of the fiscal year. It may be better to undergo a mid-year, quarterly, or even more frequent budget review, either a formal or informal process to assess progress against the budget and if any mid-course corrections need to be made.

Revenue and expense

When we look at the budgeting cycle, there are really two key components, the revenue and expense elements. Depending on the type of funding that the organization receives; contributions, grant and project based, or fee-for-service, several specific drivers exist in the revenue budgeting process.

Expense budgeting limitations depend on whether the expenses are for labor or other uses. A difficulty that many organizations face is properly targeting expenses to certain programs, departments or both. All the data that is collected from revenue and expenses is usually tracked in a fundraising, financial, human resources/payroll or operational system; but how does it get into the budgeting system? Integrating information between the systems could improve efficiency and produce more reliable budget information.

Budgeting approaches

In organizations that have a centralized approach to budgeting, Microsoft Excel spreadsheets often work well. However, for organizations taking  a more decentralized approach where the budget is prepared at the program level through several layers of management in different locations, more secure access and consolidations as well as a workflow system that tracks routings and approvals may be better.

Budgeting software

Finding the right solution for your organization can provide the processes and tools necessary to monitor and manage your operations to help accomplish your goals. The benefits a comprehensive budgeting solution provides include:

• Effectively aligning organizational strategy with the execution of operations
• Shortening planning cycles and allowing executives to focus on managing core goals
• Freeing up time and money to explore new areas of growth
• Delivering timely and accurate information to enhance decision making
• Providing powerful analytical capabilities and the ability to rapidly consolidate information
• Eliminating reliance on spreadsheets and associated formula errors

There are a multitude of budgeting solutions available for organizations of all sizes and at many different price points. However, not all solutions will be the right fit for every organization.

I would love some feedback, please take a minute to post a comment or email me with any thoughts or suggestions for future blog posts

34 Ways to Stimulate Creativity within your Organization

I am not sure about you, but sometimes I find myself in a rut and need to do something new to keep engaged with my work and also keep what I do fresh.