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Library Insurance

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Libraries are the repository of the accumulated knowledge of our culture and history. Putting a price on the value of our libraries as assets in our communities and lives seems impossible. Nonetheless, it is essential for public and independently operated libraries to obtain adequate library insurance coverage.

Similar to museum, art gallery and exhibition insurance, library insurance policies are tailored to the unique characteristics of location and size, as well as the economic valuation of the collection. In the same way that insurance for security companies is a niche type of coverage with unique characteristics, libraries must consider key factors from a prudent risk management point of view.

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Types of Library Insurance 

All institutions and organizations are responsible for having in place adequate insurance coverage from a reputable underwriter. Insurance brokers are available to provide an extra layer of expert knowledge, particularly when complex considerations such as library catalog valuations are necessary. Even organizations operated through taxation dollars are required to have public library insurance coverage.

Typically, institutions serving patrons and employing individuals will require the following types of insurance coverage:

  • Commercial Property Insurance

  • General Liability Insurance

  • Commercial Auto Insurance

  • Director and Officers Insurance (D&O)

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There are many individual considerations when obtaining a quotation for the library insurance cost from a qualified underwriter. The list of quantifiable information required includes, but is not limited to:

  • size of the library’s physical collection

  • value of donated items, artwork and rare collections

  • number of physical locations

  • age of buildings

  • number of employees

  • size of the library’s vehicle fleet

  • number of patrons who make use of the library’s public facilities

Often, libraries are overseen by a board of directors or governors, and, ultimately, fiduciary responsibilities such as insurance coverage fall to these individuals. However, it is often operational management staff who will execute the process of:

  • issuing a request for insurance proposals

  • maintaining accurate, up-to-date inventory listings of assets

  • archiving valuation documentation for rare items

  • providing an insurance policy purchase recommendation 

  • maintaining adequate communication with the broker, underwriter and board, concerning changes to the library’s collection and any material event, damage or claim suffered during the time of policy activity


Commercial Property Insurance for Libraries

Commercial property insurance coverage is common for any business or organization that maintains a physical location. Insurance policies covering commercial property can include the following coverage:

  • fire

  • theft

  • weather damage

  • flood and sewer malfunction

  • earthquake and high wind damage

  • boiler, HVAC, humidity, power outage damage

Commercial property insurance requires the accurate valuation of assets. Consideration must be given to the types of claim pay-out required. There are three basic types of commercial property insurance coverage available:

  1. Replacement cost (identical replacement in case of loss/damage)

  2. Historical cost (compensation based on original cost to acquire item)

  3. Functional replacement cost (cost to acquire an alternative item which will perform the same function)

We may think of books when we think of library assets, but consider the following listing of items that need to be considered for coverage:

  • Furniture and fixtures

  • Computers, electronic equipment and databases

  • All catalog items (including audiovisual materials, art, maps, etc.)

  • Exhibition coverage for items on-loan to the library from other owners


General Liability Insurance for Libraries & Librarians

General Liability insurance coverage is essential for any organization that hosts others, including its employees, at a physical location. The coverage provides against the risk of unintentional injury to patrons and those using the library’s facilities and objects. Insurance coverage provides protection in case there are lawsuits or claims filed.

Commercial general liability insurance is the most common form of insurance required by all businesses and organizations offering public access to their premises and encompasses insurance for libraries and librarians. General liability insurance for libraries can also protect against the following risks:

  • Injury at library-organized events held off-site

  • Coverage for volunteers working at the library, in addition to librarian insurance coverage

  • Libel and slander suits

  • Damage caused by employees (to individuals or their property)

  • Data breaches, including breach of privacy

  • Employer obligations, including workers’ compensation

It should be noted that, in some cases, individual riders are required, in addition to the basic liability policy, to ensure that specific risks and types of damage or injury are covered. It is also important to note that any independent contractor or performer commissioned by the library requires a valid certificate of insurance, or a separate addition to the library’s policy will be required on a case-by-case basis.

The average general liability insurance cost for libraries is around $30 per month, or $360 per year.

Commercial Auto Insurance for Libraries

If the library owns and operates any vehicles, they must be covered with adequate insurance to protect the library against a claim, as well as to provide adequate protection for employees or trustees operating the vehicles.

Commercial auto insurance covers cars, trucks, tractors, vans, bookmobiles and any other vehicle owned by the library. It is also possible to obtain automobile coverage for personal vehicles used by staff for library business, although these vehicles must also be adequately insured by their owners. 


Directors and Officers (D&O) Insurance for Libraries

Essential to any organization with a board of directors, officers, governors and/or trustees, a separate directors and officers (D&O) insurance policy must be purchased. D&O insurance policy protects volunteer and paid individuals who serve on the library’s overseeing body in case of intentional or unintentional harm. Before consenting to act as a trustee, individuals will often ask to see a copy of the D&O insurance policy, to be sure the coverage is adequate should there be a lawsuit filed at a later date.

Directors’ and officers’ insurance policies include the legal costs of individual trustees should they need to defend themselves against a claim. D&O insurance for libraries provides indemnification for governing individuals and puts them at greater ease when considering whether to give their time towards the library’s operational and management oversight.

In some jurisdictions, D&O coverage is required by law in order to protect those who serve their community in public service roles on a voluntary or cost-reimbursement basis. It is important for an organization to understand the regulatory requirements for their library’s operations according to regional laws.

Libraries may choose to publish a request for quotations in order to ensure their collection and assets are adequately insured. By using the policy categories and considerations outlined in this article, libraries can smooth the process and ensure that all areas of substantial risk are appropriately mitigated. 

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