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Non-Profit D&O Insurance: Examples of insurance at work

March 14, 2019

We at Scrivens are extremely proud of the partnerships we have made with non-profit and social services organizations in Ottawa. Non-profit organizations provide essential social services that benefit the community and their members. These organizations cannot survive without dedicated leaders to make major decisions on behalf of the organization.

However, even when acting in good faith, directors and officers of non-profits expose themselves to risks with each decision they make on behalf of their organization. In the event of a claim, non-profit leaders could suffer severe damage to their reputation and personal finances simply based on their decisions. In order to protect themselves, directors and officers (D&O) insurance for non-profit leaders is crucial and can provide many benefits.

Claims Scenario: Revoking Donations

The entity:

An animal shelter that regularly accepts donations from its members.

The challenge:

The board of directors of an animal shelter was recently sued by a number of their long-time donors. While these members have been involved with the non-profit for years, they felt the shelter was misrepresenting its financial status.

As a result, the donors demanded that they are repaid all the money they gave to the shelter. The shelter faced three separate lawsuits on this charge and defence costs exceeded $530,000.

Non-profit D&O insurance in action:

Non-profits rely heavily on the donations and support of others. And while you may think that donations are simply gifts, they can lead to serious litigation risks in the face of misrepresentation or other alleged wrongdoings.

In the case above, D&O insurance is invaluable, as it helps non-profits recoup the costs of legal expenses. What’s more, many D&O policies provide policyholders with access to legal professionals, who can help simplify the litigation process and ensure that non-profits navigate lawsuit concerns quickly and efficiently. Non-profits and their leaders often don’t have the funds to fight lawsuits on their own and, without the right coverage, could go bankrupt in the face of legal action.

If you would like more information regarding D&O insurance for non-profit organizations, please contact Michael Scrivens at 613-236-9101 or