While it may seem unlikely, board members of non profit companies run the risk of incurring great personal liability should a lawsuit be brought against them. That’s why securing a suitable directors and officers for non profit companies policy is to important to those entities involved in not-for-profit work. A D&O policy will protect trustees from incurring huge amounts of personal debt related to legal issues, which can devastate an organization indefinitely.
Risk Management Is Key
Managing risks is a concern for virtually every business, but it is particularly important when dealing with non profit organizations. Implementing a directors and officers policy for non profit companies is just one aspect of risk management that can greatly reduce the negative impact of pending litigation.
Unlike for-profit businesses, directors of non profit agencies often have less personal wealth due to the nature of their work. As a result, these individuals are greatly exposed to severe financial damage stemming from allegations of wrongdoing. Not only can this affect the person in question, it can also impact a charitable organization itself.
Mitigate Legal Fallout With the Right Insurance
The above illustrates just how important it is for non profit organizations to remain protected from a legal prospective. Such comprehensive protection can be afforded by securing suitable directors and officers for non profit companies insurance. The right policy can provide directors the confidence to make those decisions necessary to keep a non profit company operating no matter what.