D&O Liability Coverage for Nonprofit Organizations

Despite common neglect, nonprofit organizations need insurance too! Nonprofit organizations run on unique rules and standards, emphasizing the importance of safeguarding your nonprofit to the fullest. One of the most important insurance policies a nonprofit organization can obtain is directors and officers liability coverage. This vital insurance policy will provide your nonprofit organization with protection against damaging claims. Gathered are some informational points for safeguarding your nonprofit organization to the fullest:

  • Many individuals involved in nonprofit organizations do not even realize that they can be held liable for errors or omissions. These individuals include directors, employees, officers, and even volunteers.
  • While you may be inclined to assume that your nonprofit organization is receiving adequate protection through the Volunteer Protection Act, this is only a limited amount of coverage. Any officers or directors involved in a lawsuit will need more coverage, as the Volunteer Protection Act does not provide defense expense coverage.
  • Many individuals do not realize that nonprofit organizations are just as susceptible, if not more so, to lawsuits than any other organization. Therefore, you must obtain security for this growing concern. Lawsuits range from fiduciary duty breaches, to misuse of donor-restricted funds, to even failure to fulfill the organization’s nonprofit mission.
  • If your nonprofit organization is involved in a lawsuit, legal fees and damages will likely exceed your liquid net assets. Costly and damaging lawsuits may even make it impossible for you to protect directors and officers involved in these lawsuits.

In order to allow your nonprofit organization to continue fulfilling its nonprofit mission, you must obtain the necessary insurance protection. Contact Colorado Nonprofit Insurance Agency in Denver for all of your Colorado nonprofit organization insurance needs. We will help you reduce liability risks with customized policies that maximize security.