1. CFO Seminar September 13 th, 2014 Directors & Officers Insurance

2. What is D & O insurance Why does your club need this coverage What does it mean to you as individuals who volunteer

3. What is D & O Insurance Personal liability insurance that provides general cover to a firm's directors and senior executives. Paid usually by the firm, it reimburses (in part or in full) the costs resulting from law suits and judgments arising out of poor management decisions, employee dismissals, shareholder grievances, and other such acts committed in good faith. Criminal offenses are not covered under this insurance. Personal liabilityinsuranceprovidesgeneralcover directorssenior executivescostslawjudgmentsmanagementdecisionsemployeedismissals shareholdergrievancesactsgood faith Criminal offenses

4. Criminal acts exclusion Intentional illegal acts or illegal profits are typically not covered under D&O insurance policies; coverage would only extend to "wrongful acts" as defined under the policy, which may include certain acts, omissions, misstatements while acting for the organization. Due to exclusions and as a matter of public policy, coverage is not provided for criminal fraud.

5. Who needs Directors and Officers Insurance Condo Corporations Associations, Gun Clubs Veterans Clubs Volunteer Organizations Etc. Companies There are 9 reason why a organization requires Directors and Officers Insurance

6. 1.Non Profit Director and Officer boards can be sued by donors, employees (prospective, current or former), the general public, third parties, clients, and/or government agencies

7. 2.The personal assets of the individual board members are at stake! Directors & Officers (D&O) insurance can help protect a board member’s home, investments, or other personal assets.

8. 3.The bylaws of the Non Profit may indemnify the Board but does not guarantee the entity has the resources to fund the cost of a claim. The financial backing of a Directors & Officers policy will ensure financial solvency to the organization.

9. 4. Directors and Officers lawsuits can have a devastating impact on the operating budget of the Non Profit organization, and can even put the entity out of business

10. 5.The average cost of a Directors and Officers policy is often under $1,000 with a zero retention yet the average cost of a claim is over $100,000.

11. 6.Directors and Officers claims are not covered under General Liability or any other policy form.

12. 7.Corporate scandals have heightened regulation of accounting practices. The Sarbanes-Oxley Act has also impacted Non Profits.

13. 8. The Canada Revenue Agency has increased their scrutiny of Non Profits. Over 400 private foundations have been audited in the past year

14. 9. Directors of Non Profit boards have the same fiduciary duties as corporate board members. Non Profit Directors and Officers lawsuits may involve a variety of issues related to the daily operations of the board including

15. Duty of Care – requires Directors and Officers to act prudently and reasonably in regard to the management of the organization’s affairs

16. Duty of Loyalty – prohibits Directors and Officers from using their position in the organization to further their own personal interest

17. Duty of Obedience – requires Directors and Officers to ensure that the organization is run in accordance with it’s charter and bylaws, and that the organization complies with applicable laws

18. What if I am a member of several organizations You should confirm they carry Directors and Officers Insurance In some cases your club Directors and Officers Insurance extends coverage to you as a director of other organizations and will respond if the other organizations insurance can not cover the cost of the claims settlement.

19. Questions