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| Volunteers Insurance Service Volunteers
Insurance Service was established nearly 40 years ago to address the liability
concerns that are shared by many volunteers, would-be volunteers and the
nonprofit organizations that use their help. Following is a description of our
directors and officers liability insurance program. After reading about it, you can download an application to mail or fax to us. We will have a proposal to you within a week, in most cases.
Nonprofit Directors & Officers
Coverage
Why you should consider D&O
coverage:
Directors and officers of nonprofit organizations now
face virtually the same exposures to lawsuits as do corporate directors and
officers. Among nonprofits, the most frequent allegation involving board
liability is employment practices - wrongful termination, for example, or
discrimination in hiring practices. Traditional, commercial general liability
insurance usually does not respond to such allegations, or to most other legal
actions nonprofit boards are likely to face.
More information on why nonprofit organizations need directors and officers
liability insurance.
The minimum premium for D&O coverage available through CIMA is $800 for a $1 million limit of liability. We can have a proposal to you within one week of receiving your completed application, in most cases.
Key Features:
- All past, present and future directors, officers,
employees, volunteers, trustees, committee and the entity itself are
covered. What's more, the severability feature protects all the remaining
insureds if it transpires that any individual insured provided false
information on the application.
- Employment practices are covered. Wrongful termination;
failure to hire or promote; discrimination, including sexual harassment; and
other such practices are covered. So are claims alleging mental anguish and
emotional distress.
- Punitive damages can be covered in states where those
damages are insurable.
- The insurer pays all defense costs up front. You don't
have to hire attorneys or in any other way manage your own defense.
- Defense costs do not reduce your limit of coverage.
Suppose, for example, you have selected a $1 million limit of coverage. Now
suppose there is a judgment against you of $850,000, and legal fees amount to
$200,000. Although total costs of your claim exceeded the limit of coverage by
$50,000, there would be no "gap," no uncovered expense, with our coverage. In
fact, you still would have $150,000 available should there be a second claim
during the coverage period. This is an unusual feature in a nonprofit D&O
policy.
- "Claim" is defined very broadly. A "claim" is triggered
as soon as you receive written notice that someone intends to hold you
responsible for a wrongful act. When the claim is triggered, so is your
defense.
- Deductible amounts begin at $1,000. You may select a
higher deductible, and therefore lower your premium, if you wish.
- We cover what many of our competitors exclude. Here are
some examples of allegations that can be made against you that we cover: Libel,
slander or defamation; invasion of privacy; wrongful entry or eviction; false
arrest; false imprisonment; malicious prosecution; and infringement of
copyright, or trademark or other unauthorized use of title; plagiarism or other
misappropriation of ideas.
- Prior acts are covered. This is in contrast to the
typical nonprofit D&O policy, which covers only incidents occurring on or
after the date coverage is first placed.
- The policy cannot be canceled by the insurer except for
nonpayment of premium.
- "Two-way" extended reporting period is standard. If
either you or the insurer choose to nonrenew coverage, you automatically are
provided a 60-day extended reporting period for claims, and you have the option
to purchase an additional period.
(Certain exclusions may apply, depending on the individual nonprofit's circumstances.)
Complete a brief application for D&O Liability Insurance
coverage.
Leave an e-mail message requesting more information about D&O coverage.
Membership in Volunteers Insurance Service:
The VIS insurance programs are available exclusively to members,
who pay an annual $135 membership fee. VIS provides the following services to
members:
- Publishing VIS Connections as one of our information
resources for members;
- Maintaining for members’ use a library of information
relating to management of risks in the nonprofit organization;
- Researching available and appropriate insurance relating to
volunteer activities;
- Designing and administering insurance programs, and compiling
underwriting information;
- Providing consultation on risk management issues at no charge
to our members, via a toll-free line (1-800-468-4200);
- Assisting members, on request, with matters relating to
insurance.
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