Three Necessary
Insurance Policies
Contact: Jack Cook, CLU, ChFC, RHU,
President, Cook and Kocher
Insurance Group,
jackc@cookandkocher.com
Association management in this eco-
nomic climate strives to provide as much
value to members as possible. In doing
so, organizations take on more liability.
It is critical to know how to protect your
board of directors as well as your balance
sheet. Three types of coverage become
more necessary as a more diverse offer-
ing of services are provided to your mem-
bership.
What Makes a Good
Auditor?
Contact:
Brett Flickinger, Principal,
Dugan & Lopatka, CPAs, PC,
brett.flickinger@duganlopatka.com
When choosing an audit firm, consider:
• The audit team’s level of experience
with nonprofits in general and your
particular type of nonprofit organiza-
tion (such as an association).
Errors and Omissions Insurance
Coverage
Accreditation and certification programs
offer integral value to many organiza-
tions. Many times, it is these desig-
nations that drive the value that an
organization provides the public and its
members. In a risk management review,
have your organization ask itself whether
or not it:
• Sets and develops standards
• Publishes technical materials
• Performs consulting services
• Offers certification and accreditation
• Administers continuing education pro-
grams
If your organization offers any of these
to its membership, then an errors and
omissions insurance policy is a critical
component of your organization’s risk
management program.
Media Liability Insurance Coverage
More organizations want their websites
to not only inform members and the pub-
audits or primarily on corporate
audits?
lic, but also provide learning, reference
materials and expert opinions. Areas
such as libel, copyright, plagiarism, trademark can be covered with a broad media
liability insurance policy.
Cyber Liability/Data Breach Insurance
Coverage
The newest coverage to arise in concert
with professional liability insurance is
cyber liability/data breach coverage.
Associations are collecting and holding more data for others. Whether it is
data that is intellectual property or it is
data that contains credit card and bank
account information, the exposure to
your organization can be extreme.
Financial and operations areas of your
organization can use the protections that
these insurance policies provide. In fact,
it is precisely these types of insurance
policies that your organization should
integrate into a larger risk management
program to protect its balance sheet.
• What forms of board support do they
provide? Will they present the financial
statements and audit findings to the
board?
• What kind of management support do
they provide? Will they charge you for
all calls, meet with you outside the
audit, help you in other areas of need?
• What is their employee turnover
record? Do their people move on to
other areas of the firm or is there a
career path within their nonprofit practice area? What do their references say?
The bottom line is you often get what
you pay for. If your nonprofit’s viewpoint
is to hire the cheapest auditor you can
find, don’t be surprised with the level of
service you get. Don’t short change your
organization and its stakeholders.
