June 17, 2014
From providing common insurance coverage such as auto, building and commercial lines to business liability and worker's compensation, insurance providers seem to have a solution for every risk. The most common option overlooked by insurance brokers is the alternatives offered to opt out of paying the state unemployment insurance tax (SUTA). The Unemployment Savings Program and the Bonded Service Program are often the best choices for charitable organizations to save money. Additionally, insurance agents and brokers offering these ingenious products are eligible for commission upon engagement.
These options allow nonprofits already excluded from paying federal unemployment taxes, to also avoid contributing to the SUTA fund. Instead of paying into a state pool that assumes shared liability and have their year-to-year tax costs change based on economic conditions, 501(c)(3) groups and governmental entities can opt out of the state pool. By electing to self-insure and pay unemployment claims on a dollar-for-dollar basis nonprofit employers normally reduce costs considerably. However, nonprofits still need to budget enough money to pay future unemployment claims to their former employees and while managing spikes in unemployment costs during economic downturns. First Nonprofit Group offers unemployment solutions for nonprofits, providing more flexibility and security for these organizations than an individual savings account would.
Uncertainty common in SUI pools
InsuranceNewsNet clearly explains the necessity of having large state sponsored Trust Funds as well as their unstable nature. They point out that Due to increased claims and high levels of borrowing during the Great Recession, 16 states have a collective debt of more than $21 billion to the federal government. Of these, California is carrying $9.8 billion in debt and four other states owe more than $1 billion each. Furthermore, many of these states have increased their SUTA tax or increased taxable wage bases in response to low fund balances. Those factors are squeezing the budgets of all employers paying the SUTA tax.
It can be difficult enough for a for-profit company, which has the ultimate goal of generating profits or paying shareholders, to weather these challenges. As for nonprofit groups, rising unemployment taxes can be a serious problem. Luckily, thanks to First Nonprofit Group, insurance agents and brokers have an array of valuable products to offer their nonprofit clients.
For information on how your nonprofit clients can cost-effectively meet their unemployment insurance needs, contact First Nonprofit Group at FNCUI@firstnonprofit.com or visit www.firstnonprofitgroup.com.
Ready to chat? Get in touch today to request a no-obligation savings evaluation.
First Nonprofit has saved us so much money over the state’s program. We had one little glitch with the state recently and we contacted FNP immediately. FNP staff called us back immediately and moved to remedy the problem.
First Nonprofit has been a great partner. They have helped us saved hundreds of thousands of dollars! They have awesome resources for our nonprofit organization. Thanks for the partnership.
Life is certainly busy these days but having business partners like First Nonprofit has made some of the process hassle free. We have worked with this team for years. When we changed payroll systems, they outlined every step. I think this team is terrific and I know they get the job done! Thank you, Cruz, to all the team at FNP.
FNP has helped our agency to save thousands of dollars every year on our unemployment coverage. The service is phenomenal, and we are thankful to their team as our partner. My experience working with Marshall on the advocacy around UE for nonprofits was also a highlight as someone who teaches advocacy and lobbying for nonprofits. Really, your whole team is top shelf, so thank YOU!
Chicago Children’s Theatre has greatly benefited from our partnership with First Nonprofit, and I have always enjoyed working with the staff on our filings and any complicated questions. I would not hesitate to recommend First Nonprofit to fellow nonprofits. We’re very happy customers.
FNP is a great resource for Daniel Kids. To have a TPA that we can count on to take point on not only managing our unemployment claims, but to support and guide any protest hearing, is invaluable. All the professional support staff we have worked with have been excellent, very knowledgeable and responsive. We are grateful for the help and support, thank you.
When I first began in my position at my organization, I hadn’t had experience working with a company like FNP. The staff was so patient and helpful in helping to explain the benefits of First Nonprofit. Anytime I reach out with a question I receive a quick, clear, and thorough response. I’m so thankful that we decided to partner with FNP. Their excellence in customer service, coupled with their variety of packages frees us up to truly serve our staff and community with a peace of mind knowing that our organization is protected against unanticipated unemployment insurance expenses.
First Nonprofit gets an A+ in my book. You are so easy to work with & very knowledgeable! Whether it is my quarterly correspondence with Kim or my random interactions with Dawn about a bond … I am so pleased that I get to work with such a helpful company. Thank you!