Another way to determine if you are paying too much is to request quotations from different insurance companies. Consider securing competitive bids every three to five years. Several members of our board are active on other nonprofit boards. Most policies exclude coverage for claims resulting from any insured serving another organization. The EPL form usually includes coverage for emotional distress and other bodily injury type allegations contained within the claim.
Most nonprofits use committees to perform many of the governance and management functions.
The membership of the various committees often includes non-board member volunteers. For example, a Risk Management Committee can include board members, an insurance agent, an attorney and other volunteers. The committee and its members could be named in a claim alleging that the committee failed to purchase adequate insurance. A commercial general liability policy would not cover this claim since the occurrence does not include bodily injury or property damage. In states that do not recognize charitable immunity, nonprofits can and are held responsible for negligence stemming from foreseeable harm.