Nonprofit Directors and Officers – Know Your Risks!

Directors and officers have a responsibility to ensure the success of their nonprofit organization. That success depends on the decisions they make each and every day. So, it is vital those decisions always keep the organization’s overall mission in mind.

However, even decisions made with the best intentions may not always be viewed favorably. A board member, employee, volunteer or client may find fault with certain decisions or actions, which could lead to damaging lawsuits. For example:

  • Organizations could find themselves facing accusations of misappropriation of funds or allegations of failing to comply with the terms of received grants.
  • Employees and volunteers may allege employment practices are discriminatory, offensive or even hostile.
  • Clients may feel an organization has discriminated against them by denying them service or not treating them the same as other clients because of their class or status.

Nonprofit organizations need to be prepared to handle these situations.  Even if a complaint has no merit, responding to the allegations with internal investigations or through legal proceedings can cost thousands of dollars. But the dollar amount is just part of the cost. There is also the time spent away from your mission, the emotional toll and the damage to the organization’s reputation.

The good news – organizations do not have to face these challenges alone. Nonprofit Management Liability (NML) Insurance is designed to protect the organization as well as its directors, officers and employees. This insurance includes Directors and Officers Liability and Employment Practices Liability coverage. It also tells potential board members and donors that there is foresight and the strategic planning needed for a successful organization. But even more important, it protects an organization’s assets – allowing it to continue its mission for years to come.

The Colorado Nonprofit Insurance Agency has partnered with Monitor Liability Managers, LLC, to offer Colorado Nonprofit Organizations Director’s and Officer’s / Employment Practices Liability coverage with preferred pricing. It provides the protection you need and comprehensive risk management services to help you identify and manage any threats that could lead to a lawsuit down the road.

If you don’t have this insurance, contact Colorado Nonprofit Insurance Agency at 303-894-0298 for more information and for a no obligation quote on this essential coverage. If you do have this insurance take time to evaluate the terms of your existing policy or request assistance from the Colorado Nonprofit Insurance Agency to review your current coverage. With premiums as low as $600* how can you afford not to make the inquiry?


*Subject to underwriter approval