Church and nonprofit boards turn over constantly — terms expire, families move, volunteers step back after a few demanding years. It’s a healthy, normal part of nonprofit life, but it’s also a moment that’s easy to let insurance considerations slip through the cracks, since board transitions tend to happen through informal handoffs rather than formal onboarding processes.
New board members should know, at minimum, that D&O coverage exists, roughly what it protects them from, and where to find the policy if a question ever comes up. This doesn’t require a lengthy presentation — a single paragraph in a board orientation packet, or five minutes at a new member’s first meeting, is usually enough. What matters is that it happens consistently, rather than assuming institutional knowledge will simply carry forward.
Outgoing board members deserve a moment of attention too. Most D&O policies are “claims-made,” meaning they respond to claims filed while the policy is active, often regardless of when the underlying decision was made — but the details vary by carrier, and a board that’s about to see significant turnover, or that’s considering a change in insurance carriers, should understand how prior-acts coverage works before making a switch.
A useful habit is treating board turnover itself as a trigger for a quick insurance check-in: has the board size or committee structure changed enough to affect coverage needs, has the organization taken on any new activities or risks since the policy was last reviewed, and does the current board roster match what’s on file with the carrier. None of this needs to be complicated, but it’s easy to overlook when the board’s attention is naturally focused on the transition itself.
Action Items
- Add a D&O coverage summary paragraph to your board orientation packet.
This post is for general informational purposes only and isn’t legal or insurance advice — every policy and organization is different, so please talk with a licensed insurance professional before making coverage decisions during a board transition.
