What grant funders and government contracts require: insurance for nonprofits and care providers

What your grant agreement or government contract actually requires

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A government contract or a grant agreement names the coverage it expects before it pays: general and professional liability at stated limits, abuse and molestation coverage for anyone serving children or vulnerable adults, directors and officers, workers' compensation, a crime bond over any funds held, and auto coverage when clients are transported. The agreement's insurance section and the funder's certificate request are the checklist, and the audit will ask to see every one.

Reviewed by Michael LaBarbera, Licensed property & casualty agent, Provident Financial Group · Reviewed Oct 12, 2026 Updated Oct 14, 2026

Typical requirements and how to check them
Requirement	What they usually ask for	How to check what you have
General liability	A per-occurrence limit and aggregate, with the funder or agency named as additional insured on contracts that involve its premises or clients	The general liability declarations for the limits and the forms list for the additional insured endorsement; the agreement usually specifies blanket wording.
Professional liability	A limit per claim and aggregate for care, counselling, case management or instruction, on a claims-made or occurrence basis	The professional liability declarations: the limits, the retroactive date on a claims-made form, and whether every licence type the contract covers is named.
Abuse and molestation	A separate limit, not a sublimit, for programs serving children, patients or vulnerable adults, with screening and supervision standards the funder may audit	A separate abuse and molestation limit on the declarations or an endorsement with its own limit; a sublimit inside general liability usually fails the requirement.
Directors and officers with employment practices	A limit covering the board and the organisation, often required before the first grant payment	The D&O declarations: entity coverage, employment practices inside or separate, and the retention.
Crime or fidelity bond	Coverage over client funds, grant funds and the organisation's own money at a stated multiple or amount, sometimes naming the funder	The crime declarations: employee theft, client-funds coverage and funds-transfer fraud limits, and any loss payee the agreement names.
Workers' compensation	Statutory coverage with employers' liability limits, and in some contracts volunteer accident coverage as well	The workers' compensation information page for the states listed and the employers' liability limits; a separate volunteer accident policy if required.
Auto for client transport	Commercial auto on owned vans and hired and non-owned auto for staff and volunteer vehicles, at a stated limit	The auto schedule with every van listed and the symbols for hired and non-owned; without a vehicle, an HNOA endorsement on the general liability policy.
Cyber liability	Increasingly required where client records are held, at a limit tied to the record count	The cyber declarations: the limit, breach response and regulatory coverage, and the sublimits for social engineering.

Requirement

What they usually ask for

How to check what you have

General liability

A per-occurrence limit and aggregate, with the funder or agency named as additional insured on contracts that involve its premises or clients

The general liability declarations for the limits and the forms list for the additional insured endorsement; the agreement usually specifies blanket wording.

Professional liability

A limit per claim and aggregate for care, counselling, case management or instruction, on a claims-made or occurrence basis

The professional liability declarations: the limits, the retroactive date on a claims-made form, and whether every licence type the contract covers is named.

Abuse and molestation

A separate limit, not a sublimit, for programs serving children, patients or vulnerable adults, with screening and supervision standards the funder may audit

A separate abuse and molestation limit on the declarations or an endorsement with its own limit; a sublimit inside general liability usually fails the requirement.

Directors and officers with employment practices

A limit covering the board and the organisation, often required before the first grant payment

The D&O declarations: entity coverage, employment practices inside or separate, and the retention.

Crime or fidelity bond

Coverage over client funds, grant funds and the organisation's own money at a stated multiple or amount, sometimes naming the funder

The crime declarations: employee theft, client-funds coverage and funds-transfer fraud limits, and any loss payee the agreement names.

Workers' compensation

Statutory coverage with employers' liability limits, and in some contracts volunteer accident coverage as well

The workers' compensation information page for the states listed and the employers' liability limits; a separate volunteer accident policy if required.

Auto for client transport

Commercial auto on owned vans and hired and non-owned auto for staff and volunteer vehicles, at a stated limit

The auto schedule with every van listed and the symbols for hired and non-owned; without a vehicle, an HNOA endorsement on the general liability policy.

Cyber liability

Increasingly required where client records are held, at a limit tied to the record count

The cyber declarations: the limit, breach response and regulatory coverage, and the sublimits for social engineering.

Where the requirement lives

In the insurance section of the contract or grant agreement, often an exhibit with a table of coverages and limits, and in the funder's annual certificate request. County and state contracts for care services add the licensing agency's rules on top. The contract checker in the wallet reads the exhibit and lists each item against what you carry.

The items funders reject most

A sublimit for abuse coverage where a separate limit is required; a crime policy that covers your own funds but not the client funds the agreement names; professional liability that names one licence type when the contract covers several; and a D&O policy bought after the grant started with a prior-and-pending date that excludes the organisation's history. Each is visible on the declarations page, and each is a row in the comparison when CoverMatch quotes the coverage.

Proof that survives the audit

Funders audit certificates against the agreement, sometimes years later. A live certificate from the wallet, issued to the funder with the endorsements the agreement names, shows the current policy whenever it is opened and notifies the funder of changes. The declarations and endorsements behind it live in the document vault, so the audit request is answered from the wallet rather than from a search through email.

When the funder's limits exceed what you carry

Quote the gap before signing. Most funder requirements can be met with higher limits or an umbrella, and a separate abuse limit or a crime bond over client funds is usually available from the carriers that write care and youth programs. CoverMatch sends one application to every eligible carrier and shows the quotes against the agreement's exhibit.

Questions people actually ask

The contract requires a bond. Is that insurance?

It usually means crime coverage or a fidelity bond that pays the funder or the clients when staff steal funds. Ordinary crime insurance covers theft from you; the agreement wants coverage over the money you hold for others. Ask the funder which it means and match it.

Can abuse coverage be a sublimit of general liability?

Most funders and licensing agencies now reject a sublimit and require a separate limit, because a sublimit is often a fraction of the general liability limit. The carriers that write care and youth programs provide a separate limit when screening and supervision standards are in place.

What happens at the funder's audit?

The auditor asks for current certificates and sometimes the endorsements and declarations behind them, and checks the limits against the agreement. A live certificate link from the wallet shows the current policies with the endorsements the agreement names; keep the declarations in the document vault beside it.

Our volunteers are not employees. Do funders care?

Yes. Many agreements require volunteers to be covered under general liability and ask for volunteer accident coverage, because volunteers are not covered by workers' compensation. Check that the policy names volunteers as insureds.