Are You Volunteering More Than Your Time?
Many of our clients actively volunteer whether it be at their children’s school, with a civic organization, or on the board of a non-profit. While these commitments can be quite time-consuming, they can also pose a large liability exposure unbeknownst to most of our clients.
While most volunteers don’t want to consider the possibility of having a suit brought against them by the organization they are working for, it does happen all too frequently. When volunteers are making decisions on behalf of the organization, and especially when it involves finances, they can be significant decisions for which the volunteer is held personally liable. Oftentimes the only insurance policy the volunteer has to fall back on is their homeowner’s policy but this usually does not provide the coverage they need.
Homeowner’s policies are designed to cover claims against “bodily injury” and “property damage” such as someone falling at your house or accidently catching your neighbor’s house on fire while burning leaves on a windy day. Unfortunately neither category of claims are usually applicable to claims brought against volunteer board members. Claims stemming from volunteer activities usually involve finances and another exclusion of homeowner’s policies are “professional services.” This is important because often, board members are asked to serve based on their profession such as an accountant. Although the accountant may be volunteering his services to his church, his homeowner’s policy would not cover him due to the “professional services” exclusion.
While not all claims brought against volunteer board members are excluded from your homeowner’s policies, many are and it is therefore important to consider other insurance options to provide coverage. Two options that increase the chances of finding coverage for a suit are a personal injury policy and a personal umbrella policy. A third option that is the best for insuring actions of board members is a directors and officers (D&O) liability policy. Before joining the board of a non-profit, it is important to find out if they have a D&O policy in place. Regardless of the scale of volunteer activity, it is always best to contact your agent to discuss the activities you are engaged in and if you have the coverage you need in place.