Top risks facing charities and not for profits in 2025

In 2025, charities and not for profit organisations face a rapidly evolving risk landscape that could potentially impact their goals and, at worst, jeopardise operations. While organisations focus on making a positive impact, a number of emerging threats - ranging from digital vulnerabilities to event mishaps - pose serious challenges. Addressing these risks proactively with the right insurance solutions is critical for safeguarding the future.

1. Cybersecurity threats: the rising digital risk

As charities increasingly embrace digital platforms for fundraising, donor management, and communication, they become prime targets for cybercriminals. Cyberattacks, including ransomware and phishing schemes, can expose sensitive donor information, disrupt services and harm an organisation’s reputation.

A data breach doesn’t just compromise private information; it can also lead to financial penalties and legal battles. Cyber liability insurance is a must-have, offering financial protection, breach response resources and expert guidance to mitigate fallout. Ensuring robust cybersecurity practices, coupled with insurance coverage, can help organisations navigate the digital age securely.

2. Reputational risks: the fragile asset

A charity's reputation is its cornerstone, playing a crucial role in building donor trust and securing public support. However, even a single scandal, whether rooted in mismanagement, fraud allegations, or perceived ethical lapses, can damage years of goodwill. Social media amplifies the risk, as negative news can spread rapidly.

Directors and officers (D&O) insurance protects board members and executives from claims of mismanagement or governance issues, enabling the organisation to respond to allegations, without jeopardising its finances. Pairing this with a strong crisis management plan ensures resilience against reputational risks.

3. The perils of public gatherings and event liabilities

Fundraisers and volunteer activities are the cornerstones of not for profit work. However, these events bring inherent risks, such as injuries, property damage or other unforeseen incidents. For example, a slip-and-fall accident during a charity event could lead to a costly legal claim.

Public liability insurance offers protection against legal claims from anyone who is injured or whose property is lost or damaged as a result of your activities. Some venues may require you to have this insurance in place, and you may be able to get cover against cancellation of an event due to bad weather.

4. Employment disputes and workplace vulnerabilities

Charities are not immune to employment-related disputes, including claims of discrimination, harassment or wrongful termination. Employment liability insurance can shield organisations from the financial burden of defending such claims, covering legal fees and settlements. Investing in employment liability insurance fosters a secure and fair workplace environment while protecting an organisation’s resources.

5. The unpredictable challenge of natural disasters and property damage

Natural disasters pose a growing threat to physical assets and operations. A damaged office or facility could halt essential services, impacting both staff and the community which it serves.

Property insurance covers rebuilding and repair costs, while business interruption insurance ensures continuity by covering lost income during recovery periods. Together, these policies provide a safety net against environmental unpredictability.

6. Proactive risk management and the insurance advantage

Charities and not for profit organisations operate in a world of increasing complexity, where risks can strike from multiple angles. Insurance is not just a financial safeguard; it is a vital tool for enabling you to continue your work without interruptions.

By partnering with experienced insurance providers, such as PIB Insurance, to tailor coverage to your unique needs, you can address these vulnerabilities head-on. From cybersecurity breaches to reputational crises, having the right protections in place enables your charity to focus on what matters most.

Talk to PIB

Is your charity or not for profit covered? Now is the time to assess risks, secure coverage, and ensure your organisation is prepared for the challenges ahead. If you are looking at insurance and risk management advice for your charity, please call the charity team on 0330 058 9862 or contact us below.