05/16/2018

Six Considerations to Examine Before Joining a Nonprofit Board

You should be aware of some common risks

It may be the last thing you are thinking about when you volunteer on the board of a nonprofit, but are you aware you might be putting your personal assets at risk? The reason for that is nonprofits face many of the same threats as for-profit businesses, including the potential for lawsuits. If the nonprofit is sued and lacks the proper planning and protection, you could lose your savings, your home and other assets.

Nearly two out of three nonprofits reported a Directors & Officers liability claim within the past 10 years. These lawsuits can be brought by donors, vendors, competitors, employees, government regulators and others, and they are not limited to suing the nonprofit organization. As a member of the board, you could also be sued personally, and be responsible for the cost of hiring your own attorney to defend yourself.

“Serving on a nonprofit board can be a commitment of your time, talent and treasure,” says Thomas Herendeen, Non-Profit D&O Product Manager for Travelers. “You’ll want to take the time to understand the nonprofit’s mission, how it operates and whether you might have any conflicts of interest before you decide to join a board.”

Please select this link to read the complete article from Travelers.