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Are Your Board Members Protected with D & O Insurance?

July 24, 2013

DOINSURANCEBeing a board member–a good one–is a demanding but extremely rewarding way to share talents, experience, local knowledge, connections and passion for a charitable cause.

No one likes to think about the possibility of anything going wrong in this good work, but it can happen.

Are your board members protected?

Many shrewd prospective volunteer leaders would like to know that your organization has a current Directors and Officers Liability Insurance Policy (D & O insurance) before committing to a board position.

Based on data nonprofits have provided in The Giving Partner, how many local organizations have a D & O policy? Here’s the breakdown:

  • Have a current D & O Insurance Policy:  50%
  • Do not have a current D & O Insurance Policy:  35%
  • No answer:  15%

Nonprofits are not required to answer the D & O question to have their profiles published in The Giving Partner.  But an affirmative answer to this question is one good sign that your organization is prepared for a professional governing board.

The cost of D & O insurance is not (or should not be) prohibitive–it’s simply one cost of doing business. If your organization decides not to carry the policy, know the risks so that you can answer questions from current and future board members.

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