Aon Association Services Association Business Insurance Solutions Directors’ & Officers’ (D&O) Insurance: What you need to know. September 5, 2012 Presented by Josh Srnka

Association Business Insurance Solutions Disclaimer This presentation is not meant to suggest that any insurance policy issued by any organization represented today would provide coverage for any specific claim. Coverage for any particular claim depends on the circumstances of the claim and the language of the relevant policy. Any name or image that bears any resemblance to any person, real or fictional, is purely coincidental. 1

Association Business Insurance Solutions Responsibilities / Basic Duties Management Liability Insurance What is D&O Insurance? Who’s Covered? What’s Covered? Common D&O Claims Mitigating Risk Q&A Agenda 2

Association Business Insurance Solutions Nonprofit organizations should be operated and managed with at least the same degree of care as for-profit corporations. Directors and Officers are subject to three basic duties in executing their obligations: 1.Duty of Care – act prudently 2.Duty of Loyalty – act in the best interest of the organization 3.Duty of Obedience – adhere to the organization’s bylaws Responsibilities / Basic Duties

Association Business Insurance Solutions Directors and Officers (D&O) Liability Insurance Employment Practices Liability Insurance (EPLI) Professional Liability Insurance – Errors & Omissions (E&O) Coverage Fiduciary Liability and/or Employee Benefits Liability Crime and/or Fidelity Coverage Management Liability Insurance 4

Association Business Insurance Solutions Protects an association against allegations of mismanagement, neglect or breach of duty as it relates to the management of the organization. A crucial component of Nonprofit D&O insurance is the protection for the association against employee related allegations – including allegations of discrimination, wrongful termination and sexual harassment, as well as failure to hire or promote. What is D&O Insurance? 5

Association Business Insurance Solutions The D&O insurance policy Definition of Insured usually includes….The Entity, as well as past, present & future Directors, Officers, Committee Members, Trustees, Employees & Volunteers. The heirs, executors, administrators and legal representatives of an Insured, in the event of an Insured’s death, insolvency or bankruptcy. Who is covered? 6

Association Business Insurance Solutions Coverage typically Includes: Employment Practices Liability Insurance (EPLI) o Discrimination (Race, Gender & Age) o Wrongful Termination o Harassment Personal Injury (Libel, Slander & Defamation of Character) Publisher’s Liability (Copyright or Trademark Infringement) Mismanagement of the association’s funds What is covered? 7

Association Business Insurance Solutions Employee / Employer Disputes o Discrimination o Wrongful Termination o Sexual Harassment o Failure to Hire or Promote Alleged Anti-Trust Violations Membership Disputes Standard Setting, Certification, and Peer Review Defamation Common D&O Claims 8

Association Business Insurance Solutions Remember the three duties (care, loyalty & obedience) Document, document, document Legal counsel EPLI Website Does it sound right / Cooling off period Mitigating D&O Risk 9

Association Business Insurance Solutions Questions?? 10

Association Business Insurance Solutions Josh Srnka Account Executive Aon Association Services th Street, NW, 6th Floor Washington DC, Phone: Website: asae-aon.com Contact Information 11