Insurance Toolkit home | Contact Us | Volunteer Alberta

Tools | FAQs | Glossary

 

Did You Know?

CLAIMS DATA

In Canada, when a claimant sues an organization the law doesn’t distinguish between not-for-profit and for-profit organizations.
For this reason, we do not have information about the number or type of insurance
claims in the voluntary sector as it is not broken out from other types of commercial insurance claims.

 

• Basic Terms
• Common Questions
• Liability Concerns
• Types of Insurance
• Volunteers and Insurance
• What is a Certificate of Insurance

How Does Insurance Work?

Insurance spreads your organization’s risk across all the organizations and individuals that buy insurance from the same insurance company. The premiums paid by all of an insurance company’s policyholders are
pooled together and then used to pay claims.

Why Aren’t Insurance Rates Stable?

There are a number of reasons why the cost of insurance changes over time. To set insurance rates, insurance companies use various calculations and general claims statistics from previous years to estimate the number and cost of current and future claims. As well, if your organization has a history of claims, that may also affect your rates.

Rates are also affected by factors such as:

• an insurance company’s overhead costs
• commission payments and returns on their investments
• external market forces
• government regulations
• taxes.

All these factors affect whether your insurance rates stay the same, go up, or
come down. Over the past few years, many voluntary sector organizations have
experienced this cycle firsthand as they watched their premiums skyrocket, or
were denied coverage for their programs and activities.