Financial liability

On the 3 boards I serve they all have insurance.

Can you give me any links re: insurance?

Thanks!

husker, Our organization(s) has insurance too, but the homeowner's policy is primary in the event of a law suit.

sozobe, You should purchase the liability insurance for board members on the same policy as your organization's. It's called Directors and Officer's (D&O).

What I'm saying is that as far as I know there is no insurance at all. I don't think the chair knows about the possibility. I'd like to suggest it to her, and am looking for links/ info.

This is what we have
liability insurance for board members on the same policy as your organization's. It's called Directors and Officer's (D&O), it's closer to $700.00 per year - I have one policy here now under review for the board.

Soz
This policy I have here is not of of my choice - give me until Monday or Tuesday to get you some good info.

Have you considered asking your question onsoc.org.nonprofit, a Usenet forum specialized on questions about running nonprofits? As a matter of Usenet etiquette, you want to check their FAQ before asking your specific question on the board. From superficial skimming, it appears that the FAQ has lots of information about liability here. In particular, they say that there's a whole organization dedicated to your problem. Here's their contact info.

Nonprofit Risk Management Center
1001 Connecticut Ave NW, Suite 410
Washington, DC 10036-5504
202/785-3891 Fax 202/833-5747
http://www.nonprofitrisk.org

You take it from there. May your fundraiser raise lots of funds

Judging by Google searches for the keywords "board, liability" on soc.org.nonprofit, the standard book on the issue is the American Bar Associacion's "Guidebook for Directors of Nonprofit Corporations". It is available at Amazon for $24.95.

http://www.amazon.com/exec/obidos/tg/detail/-/1590310438/qid=1076927668/

Good luck again!

Thanks, Thomas!

Looking forward to you info, Husker.

Sozo
You have important email with contact information.

OK, I think we need to back up, though...

I contacted one of the insurance companies that I got to from Thomas' links, and received this answer:



So I'm not so sure D&O is the answer, here.

You need to have D&O no matter what

OK, I'll bring that up to them.

The main thrust of my question, though, is that I am very worried that we won't get enough money to cover costs, and then what? This doesn't seem to be the answer to that specific question.

No one is going to give you insurance for paying your bills. If you knowing accumulate debt more than assets in an effort to defraud someone them the Corporate veil still may not protect you. If there are unforeseen changes in operating climate such as a depression or circumstances beyond your control the Corporate veil may protect you.
The D & O will protect you if you discover someone did something way wrong after the fact and it might have dramatic consequences on the operation of the nonprofit - from lawsuit or whatever.
IMO - I have to really ready the policy I have at home.

Right, I understand that, I'm trying to figure out what the options are. If there are none, fine. But what about, for example, bankruptcy?

There is a part of me that thinks how can these people have a 501c3
without having policies, procedures, and budgets? They already have a letter of determination on the 501c3? A working business plan, with goals and objectives? Has this group ever gotten any grants from anywhere?

Sorry to toss this out as you might have covered parts before - spank the board. Did you find out if you guys had an attorney?

bankruptcy sounds like a bad idea if they knowingly "wrote checks they cannot cover" made arrangements that they should not have.

Yes, we have an attorney on the board.

The main thing here is not that there definitely won't be money but that there might not be money. Whether there is money depends on how many registrations are sold, and that is an unknown.

General overview -- this is a brand-new organization, brand-new board. I have gotten them one grant so far. There is rampant incompetence. I have felt that I needed to stick around because I had resigned as the president of a similarly incompetent board, and I was unwilling to cement a reputation as a quitter. (In retrospect, I so so so so SO wish I would've quit long ago, but whatever.) As it goes along, I have felt worse and worse about leaving them in the lurch, as it would be if I quit at each stage. It would be really messy if I left now, and I don't have the heart to.

I have a fairly narrowly defined role of fundraising coordinator, which nonetheless is made very very difficult by how little I have to work with. I am not an officer.

I have spanked them, but the only remaining spank available is to resign, which they probably deserve, but I am unwilling to do.