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Are You On the Board of a Non-Profit Organization?

Now that the weather is finally taking a turn in upstate NY, many people are getting active again. If you are like myself, you may be thinking about doing volunteer work, like park clean-up, or even joining a non-profit board. Your employer may even encourage you a non-profit board member, or you may feel compelled to join your neighborhood homeowners association.

But did you know that joining a non-profit board can be risky? And a homeowners policy will not provide coverage. Here are some staggering statistics provided by a non-profit publication:


NY directors & officers insurance will protect you as a board member.


  • About 1 in 100 nonprofits each year will file a claim under directors & officers (D&O) insurance
  • Average cost of a settlement in a D&O claim (meaning it didn’t go to court): $28,000
  • Average legal costs of defending a claim: $35,000

What this means is that there is a decent chance that you could be sued personally for actions you take or decisions you make as a non-profit board member.

Our goal is not to discourage you from joining a non-profit board; in fact, the entire Murray Group team is encouraged to join and support New York non-profit organizations as volunteers, donors, committee members and board members.   It is our opinion that non-profit service is an incredible and cherished honor, and we have even created a program called TMG Cares.

We want to make sure you are protected in your role as a board member. There is no need to expose yourself to lawsuits in your attempt to do good for your community or neighborhood.

Here are two things that you must do if you are currently a member of a board or are considering joining one:

  • Don’t join a board unless there the non-profit has purchased NY directors and officers insurance.

    D&O insurance is critical to any non-profit’s business insurance program. NY directors and officers insurance is going to be your first line of defense as a board member in this type of lawsuit. It covers defense costs, settlements and judgments arising out of lawsuits and wrongful act allegations brought against a non-profit organization and its members.

  • Buy a personal umbrella policy

    A personal umbrella policy is going to provide with at least $1 million in additional personal liability coverage above and what is provided on your homeowners/renter policy. The umbrella will provide coverage for bodily injury, property damage, and personal injury claims against you arising out of your volunteer services on a nonprofit board.

At The Murray Group, we offer both directors & offers liability insurance as part of our business solutions and personal umbrellas as part of our personal solutions. They are integral parts of a comprehensive risk management program, whether you are a business or an individual.

Please call today and speak with a personal or commercial risk advisor if you are in need of coverage. Whether you are an uninsured non-profit organization or an individual, we are here to help.

Live Secure 365,

Ryan Murray

VP, Risk Consultant

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