Is your organization covered?

Nonprofits and charities are focused on creating solutions to strengthen communities. However, in the course of this work, employees or volunteers may offer advice and counsel that simply falls short— or worse, causes harm. What happens when an oversight or mistake results in a lawsuit? If you’re found liable for professional negligence, a lawsuit may be too much for your organization to bear. How do you ensure you’re protected?

Errors and Omissions Insurance (or Professional Liability Insurance) can help safeguard against these risks and offer nonprofits and charities critical financial protection. E&O Insurance provides funds to cover lawyers’ fees, court costs, and even settlement or judgment fees related to initial charges. Even a meritless claim may be covered by your policy so that you don’t have to pay out-of-pocket for legal fees and other court costs.

Who can be held to a professional standard of care?

Until recently, only those organizations employing doctors, lawyers, and accountants would likely consider E&O Insurance. But today, a growing number of nonprofits are exposed to the types of claims alleging errors and omissions in the delivery of professional services that are covered under these policies.

Nonprofit organizations in health care, social services, or any field that provides counseling or other professional services can be especially vulnerable to risk and should consider E&O Insurance. Whereas Directors and Officers Liability Insurance (D&O) covers the performance related to the duties of the directors and officers, E&O insurance covers failures or negligence with respect to service to clients. Professional services under E&O includes services performed for, or advice given to, others on behalf of the organization.

Any person or organization providing professional services, whether for a fee or not, can be described as a professional, especially if their occupation requires:

• A period of technical and practical training
• A commitment to rigorous professional guidelines, principles, and service standards
• Provincial or national regulation

Some client contracts will require that your organization has an E&O policy in place before they work with you. That way, if your organization is truly responsible for a mistake— including incomplete or incorrect work— you can account for the financial losses your client may suffer due to oversights. It’s important to note that you’ll need to have a Professional Liability Insurance policy in place before an accident happens to receive coverage. Most E&O policies only cover incidents that occur while the policy is in force.

Be sure you’re covered.

Want to learn more about finding an Errors and Omissions policy that fits your organization’s needs? ONN’s expert insurance partners at HUB are happy to help. We can tailor your Professional Liability plan based on the number of people you need to cover and the professional responsibilities you need to insure. Contact HUB International’s Steve Primiani: steve.primiani@hubinternational.com, (905) 948-2896.

ONN Nonprofit Insurance Program

Nonprofits have different insurance needs than for-profit businesses. ONN has done all the homework for you. We created the ONN Nonprofit Insurance Program to ensure nonprofit organizations get the coverage they need.