Insurance is Key to Protecting Your Board Members
Board member burnout isn’t new, but recent events also have members concerned about their potential liability, only compounding the effect on board retention.
“It’s just been a really tough time for boards, and it already wasn’t a glorified position,” says Jennifer Horan, a shareholder in the Naples, Fla., office of Becker & Poliakoff. “I have boards contact me all the time about ‘what if we can’t get people who will serve?’”
Perhaps the most critical tool to protect board members is insurance. “Each of our associations has insurance is in place, including liability and directors and officers (D&O) coverage,” says Paul Grucza, director of education and client development at the Seattle-based management company CWD Group, Inc.
The question boards are asking now, though, is whether they enough insurance.
“I’ve had more than one board reach out to me, asking if they should increase their liability policy given what happened at Surfside,” Grucza says. “I’ve also seen more potential board members asking what the insurance covers should they become board members.
“My recommendation in light of the Surfside tragedy — and the temperament of people these days — is that a board should increase coverage if they feel they can handle the cost increase. I’m seeing them do that routinely, changing, for example, a $5 million umbrella policy to $10 million.”
Of course, there’s no universal coverage and limits that are advisable for every association. “The board really should consult with a broker to find out the best course of action to get adequate coverage,” Horan says.
Read the full story now to learn what you should tell your clients to do to safeguard their boards and ease the minds of their volunteers: