I am Volunteer - what do I need to consider from an insurance perspective.
Depending on the type of organization, and the duties that you do as a volunteer will determine the degree of concern that you may have.
If you simply volunteer and show up at events to help out, or attend meetings, there is not to much to worry about. Most of the events the organization may be involved in are usually covered by the organization's general insurance policy. The first question that comes to mind is "Does the organization have a Comprehensive Liability insurance policy?"
If they do have a policy, it will likely have a $1,000,000 or $2,000,000 limit. Many of the events the organization will be involved in will be covered under this general liability policy. Your non-profit organization's liability policy will usually have a clause in it that extends coverage for Volunteers, so if you were directly involved, the organizations policy would protect you and the organization jointly.
If there was no policy, or the limit is insufficient to provide full protection it is not likely that the organization would have adequate funds to pay damages. That is why, if you are directly involved in the incident, you will be named along with the organization in the suite. This is a precaution taken by the lawyer representing the person seeking damages. That person's lawyer does not know how much liability insurance there is, or if there is any at all, so he wants to make sure that anyone who could be held responsible is named the law suite.
That way, if they win, only to find out there was no insurance, and no assets belonging to the organization that they have someone to seek compensation from. This would be you.
Any time you are named in a law suite of this nature you will want to contact your insurance company so they become involved. They will work with the organization you were volunteering for to look after your interests, pay you for attending court proceedings, cover any court cost you may have, and eventually pay a settlement should that be necessary.
Keep in mind an award which is meant as a penalty such as a fine.or damages cause during the commission of criminal offence by you would not be covered under any liability policy. Coverage for abuse and molestation is an intentional act and is excluded under the policy.
Even though the organization may have a liability policy in place does not mean that some of the events it becomes involved in will be covered under the organizations general liability policy. In some cases the organization may be required to buy a special events liability policy. Events that involve the use of fire works or serving of alcohol, are good examples. If you are being asked to serve alcohol at an event you may want to make sure the organization has a special events policy. The limit of coverage should be at least $2,000,000, preferably higher.
Some clubs, especially sports related clubs, have association insurance programs where individuals have coverage with their memberships. You, as a participant or coach may have specific coverage under the association master policy. You may want to inquire as to the coverage being provided.
Your home insurance policy will not cover you for activities that you are compensated for. This does not mean that you can not be compensated for travel expenses or other type of costs you incur while acting as a volunteer. If you get paid for coaching, as an example, you will have to rely more heavily on the organization's policy and may want to make sure you are clearly covered under the policy.
As a Board Member You Have More To Worry About
Taking on the role of board member means you often have to rely on others to provide information and complete tasks that are not within your control. Those people you rely on may not be truthful or or simply lack competency. In a close organization with a common goal and adequate involvement from the members mistakes are often absorbed and overcome by the organization. When infighting and bickering is present it is more common for small things to escalate to legal action.
Most often, the problems involve a broken relationship between the organization’s board of directors and its executive director.Many non-profit organizations have paid employees. The most senior manager among them typically has the title of executive director (although some more grand titles – CEO, for example - seem to be fashionable at the moment).
Home insurance typically covers for bodily injury and property damage losses. These terms are defined in the policy.
"Bodily Injury” means bodily injury, sickness or disease or resulting death.
“Property Damage” means physical injury to, or destruction of tangible property, including resulting loss of use of this property.
Libel, slander, and defamation are some of the acts most insurance companies would consider intentional and would not be covered under your home insurance. Acting as a director or officer for a non-profit organization gives rise to the possibility of you taking actions that may be deemed intentional.
Director's and officer's liability insurance is certainly one of those special and additional policies that many organizations are now purchasing to protect the Directors and Officers from the expenses from legal actions brought against them by members and employees alike.
On an individual level and Umbrella Liability Policy would be a consideration as it would provide coverage for these as long it was not criminal or malicious in nature.
Depending on the type of organization, and the duties that you do as a volunteer will determine the degree of concern that you may have.
If you simply volunteer and show up at events to help out, or attend meetings, there is not to much to worry about. Most of the events the organization may be involved in are usually covered by the organization's general insurance policy. The first question that comes to mind is "Does the organization have a Comprehensive Liability insurance policy?"
If they do have a policy, it will likely have a $1,000,000 or $2,000,000 limit. Many of the events the organization will be involved in will be covered under this general liability policy. Your non-profit organization's liability policy will usually have a clause in it that extends coverage for Volunteers, so if you were directly involved, the organizations policy would protect you and the organization jointly.
If there was no policy, or the limit is insufficient to provide full protection it is not likely that the organization would have adequate funds to pay damages. That is why, if you are directly involved in the incident, you will be named along with the organization in the suite. This is a precaution taken by the lawyer representing the person seeking damages. That person's lawyer does not know how much liability insurance there is, or if there is any at all, so he wants to make sure that anyone who could be held responsible is named the law suite.
That way, if they win, only to find out there was no insurance, and no assets belonging to the organization that they have someone to seek compensation from. This would be you.
Any time you are named in a law suite of this nature you will want to contact your insurance company so they become involved. They will work with the organization you were volunteering for to look after your interests, pay you for attending court proceedings, cover any court cost you may have, and eventually pay a settlement should that be necessary.
Keep in mind an award which is meant as a penalty such as a fine.or damages cause during the commission of criminal offence by you would not be covered under any liability policy. Coverage for abuse and molestation is an intentional act and is excluded under the policy.
Even though the organization may have a liability policy in place does not mean that some of the events it becomes involved in will be covered under the organizations general liability policy. In some cases the organization may be required to buy a special events liability policy. Events that involve the use of fire works or serving of alcohol, are good examples. If you are being asked to serve alcohol at an event you may want to make sure the organization has a special events policy. The limit of coverage should be at least $2,000,000, preferably higher.
Some clubs, especially sports related clubs, have association insurance programs where individuals have coverage with their memberships. You, as a participant or coach may have specific coverage under the association master policy. You may want to inquire as to the coverage being provided.
Your home insurance policy will not cover you for activities that you are compensated for. This does not mean that you can not be compensated for travel expenses or other type of costs you incur while acting as a volunteer. If you get paid for coaching, as an example, you will have to rely more heavily on the organization's policy and may want to make sure you are clearly covered under the policy.
As a Board Member You Have More To Worry About
Taking on the role of board member means you often have to rely on others to provide information and complete tasks that are not within your control. Those people you rely on may not be truthful or or simply lack competency. In a close organization with a common goal and adequate involvement from the members mistakes are often absorbed and overcome by the organization. When infighting and bickering is present it is more common for small things to escalate to legal action.
Most often, the problems involve a broken relationship between the organization’s board of directors and its executive director.Many non-profit organizations have paid employees. The most senior manager among them typically has the title of executive director (although some more grand titles – CEO, for example - seem to be fashionable at the moment).
The executive director usually has responsibility for fund-raising activities, overall management of the organization’s operations, and hiring, firing, and supervision of other employees. He or she will often be the sole conduit of information to the board of directors and will have day-to-day control over the organization’s finances.
Simply put, the executive director exerts an extraordinary amount of authority. The relationship between the executive director and the organization’s board of directors will tend to run hot and cold. It can be very close and productive one day and then, seemingly overnight, it can turn toxic.
This scenario often results in the parties “arming up” with lawyers and can lead to wrongful dismissal litigation. Needless to say, in the non-profit sector the associated costs can be destructive for the employer – these don’t tend to be organizations with endless sources of funds. The most frequent cause seems to be the existence of an “imbalance” in the relationship between the executive director and the board.
Members of boards of directors at non-profit organizations tend to be volunteers and often fill roles for which they are untrained. They offer their services for a variety of reasons (one of which, I hope, is a genuine interest in whatever activity the organization is pursuing).
Directors place a high degree of trust and faith in the organization’s executive director. But, at least to some extent, their function is to corral the activities of the executive director. If they do not do so, the executive director’s scope of authority (or at least his or her perceived scope) can reach an unhealthy level. In some instances, it seems the executive director comes to perceive him or herself to be the organization. It’s as if the executive director has developed a heightened sense of entitlement, losing sight of the boundaries of his or her employment.
Left unchecked by the board, an executive director has the opportunity to engage in a variety of financial and other improprieties. Because the executive director controls the flow of information, board members can be the last to know about the existence of these problems.
For most of these issues, a better balance in the relationship between board of directors and executive director provides the answer. A board which is active and inquisitive in pursuit of fiduciary principles of governance will go a long way towards fostering an understanding on the executive director’s part of the boundaries of his or her discretion.
That result requires board members who take their governance role seriously. A good rule of thumb for people who wish to serve on a not-for-profit board is “don’t volunteer if you aren’t passionate about actively fulfilling the role for which you have volunteered”.
Both Professional and Armature Sports Clubs Can be Political
Parents often become concerned about their children's well being, what position they are asked to play, how much time they get to play, and so on. Some of these situations get out of hand. They sometimes escalate into character assassinations and personal attacks leading to the courtroom.
Both Professional and Armature Sports Clubs Can be Political
Parents often become concerned about their children's well being, what position they are asked to play, how much time they get to play, and so on. Some of these situations get out of hand. They sometimes escalate into character assassinations and personal attacks leading to the courtroom.
Condominium corporations are another organization that is prone to these situations as they are often underfunded and prone to market forces and hazards that cause bickering and pettiness to take hold.
Home insurance typically covers for bodily injury and property damage losses. These terms are defined in the policy.
"Bodily Injury” means bodily injury, sickness or disease or resulting death.
“Property Damage” means physical injury to, or destruction of tangible property, including resulting loss of use of this property.
Libel, slander, and defamation are some of the acts most insurance companies would consider intentional and would not be covered under your home insurance. Acting as a director or officer for a non-profit organization gives rise to the possibility of you taking actions that may be deemed intentional.
Director's and officer's liability insurance is certainly one of those special and additional policies that many organizations are now purchasing to protect the Directors and Officers from the expenses from legal actions brought against them by members and employees alike.
On an individual level and Umbrella Liability Policy would be a consideration as it would provide coverage for these as long it was not criminal or malicious in nature.
If pettiness and bickering starts to become a regular occurrence at meetings or in your day to day activities a volunteer maybe you have been in a director role too long and it is time for a break.
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