When Does Your Nonprofit Need Professional Liability Insurance?

Would your nonprofit benefit from professional liability insurance? 

If you a nonprofit, you are likely to have General Liability insurance in place. You may also have Directors and Officers (D&O) insurance as well as any other critical insurance you needed when you first started the nonprofit. As a result, you think you’re covered. Right? Not so fast. It is possible that your nonprofit organization needs Professional Liability insurance, otherwise known as Errors & Omissions insurance, as well.

Most nonprofits mistakenly believe that their D&O policy covers errors and omissions or malpractice, however, this is not always the case. D&O coverage is designed to protect personnel from claims that arise due to actions they have taken within the scope of their duties as officers, directors, or company individuals. Professional Liability insurance, however, applies to errors and omissions while performing the service that is part of your organization. In a society where lawsuits are common, all it takes is one sizeable lawsuit to shut your nonprofit down.

Nonprofit organizations that work in health care, human services, or any field that provides counseling or other professional services are especially vulnerable to risk. This means that they can benefit from having E&O coverage. Keep in mind that D&O insurance coverages the performance related to the duties of the directors and officers, while E&O insurance covers failures or negligence with respect to service to customers. Talk to your insurance agent to determine if you can benefit from either or both policies.

Are you ready to secure the right coverage for your nonprofit’s needs? To find tailored coverage, contact the experts at Colorado Nonprofit Insurance Agency, part of HUB International in Denver, Colorado at 303-894-0298.