Thank you for your input.

Barb Brazelton

Metolius River Forest Homeowners Ass.  

Your questions is a good one.  From my point of view, there is a trade off of potential risk/liability and cost of officer insurance. I'm not sure there is a exact answer to when does the risk or liability justify the cost.  There are several factors to consider;

How large is the organization?  The larger the size, the greater exposure a board decision could 'harm' someone. 

Size of annual budget.  Somewhat related to size and services provided by the organization.  Officer insurance comes at a certain cost, so the larger the association's budget, the more feasible the cost of officer insurance may be.

Does the organization own or operator any facilities, like a water system?  If the association owns facilities and/or provides services to it's members, there is more potential risk of 'harming' someone by an officer decision.

Using the Lake Wenatchee Summerhomes Association as an example (my local association), we have fewer than 50 cabin members, do not own or operate any facilities, and have a small annual budget. We don't have officer insurance due to the cost and our perceived low level of risk or liability. I welcome other thoughts on this subject.

Doug Gann
NFH President