What Happens if Your Non-Profit Doesn’t Have the Right Insurance?

Take a closer look at the dangers of going coverage-free.

Non-profits, by nature, don’t make a lot of excess money to spend unwisely or keep it individually. Through collecting funds through donations, government grants, sales, and other sources of income, they apply the funds to areas in need within their community or internationally. Although it can seem like a burden to invest funds from what little budget they have, refusing to get coverage can be more devastating.

Let’s take a look at directors and officers (D&O) liability insurance, a type of coverage that you know you need. D&O insurance is generally one of the most recommended types of coverage for any kind of non-profit as it covers such universal issues as mismanagement of funds, questionable board decisions, board harassment, and discrimination. These are all situations, of course, that could pose genuine problems in the long-term running of a non-profit organization. The danger of being struck with a D&O claim is, unfortunately, not negligible. If you do happen to face this lawsuit, you may be looking to pay $150,000+ in fines and fees if you don’t have any insurance to rely on.

D&O insurance doesn’t just save you from legal fees. This insurance coverage provides indemnity (compensation for damage), and related expenses. In short, your funds are truly well-protected with a policy like this.

Maybe you know that you need insurance but don’t know where to start. Luckily, there are experts out there to help guide you to the right policy that suits your non-profit needs and budget. The best approach is to assess your risk management and risk assessment. With any insurance, your needed coverage and the total premium cost will vary depending on the size of your risk.

Remember that accidents and damage can happy to any non-profit organization. The best thing you can do to prepare your business is to have an insurance policy that covers potential future expenses. Contact the experts at Colorado Nonprofit Insurance Agency, part of HUB International in Denver, Colorado at 303-894-0298. We will work with you to ensure you are getting the most out of your coverage.