Suggestions for Grantee Insurance
2 CFR 215.31 requires that grant recipients provide equivalent insurance coverage for equipment acquired with federal grant funds. All employers are required by state law to provide WorkerÕs Compensation Insurance for their employees.

Additionally, grantees must maintain effective control over and accountability for all grant funds.

Also, during the course of normal business, officers, employees, and volunteers make decisions and take action on behalf of the organization. Sometimes these decisions may affect people outside the organization, either positively or negatively, and sometimes errors are made. Sometimes officers, employees, and volunteers exercise poor judgment and act inappropriately or illegally. In all of these situations, the organization, its officers, employees, and volunteers must be protected, and insurance may offer some degree of protection.

The following are several types of insurance policies that grantee organizations should consider to protect not only federal grant funds and equipment, but also the people and assets of the organization. Other types of insurance policies are available.

  1. Directors and Officers Insurance for Board of Directors and Staff.
  2. Fidelity Bond Insurance to cover all Federal grant funds.
  3. Insurance to cover replacement cost of any equipment items bought with grant funds. (Actual Cash Value insurance will be based on the age and condition of the equipment, and may not be enough to replace it.)
  4. Workers comp insurance for all employees and volunteers.
  5. Property Insurance (in the event buildings or other property is owned).
  6. Automobile Insurance, should grantees own vehicles.
  7. Liability insurance covering the organization.

This should not be considered a complete list of types of Insurance a grantee may need. Grantees should discuss coverage limits and policy types with their insurance agent. He/she can make a recommendations based on the types of activities the grantee will be undertaking in the performance of work related to the grant project.