Your board of directors is critical to your nonprofit’s operation and finances. Accusations of misconduct, abuse of funds, wrongful termination, and employee discrimination can put the personal assets of your directors and officers at risk.
But just like any other exposure, you can put controls in place to prevent and manage these risks. These control activities will act in the best interest of services to your clients, which is ultimately the goal of your organization.
Listed below are wrongful acts your organization should be aware of:
Nonprofit organizations can purchase Directors and Officers insurance coverage on behalf of their board to indemnify them against these types of claims. And sometimes, NPOs need the coverage to obtain certain directors and board members. Directors and Officers insurance can provide added protection against those liabilities that organizations can’t indemnify under state laws.
NOTE: This information is provided free of charge by Nonprofit Insurance Services, where our goal is to fully protect your organization so that you may succeed in your mission.