NONPROFITS’ UNITED
BOARD OF DIRECTORS’ RESPONSIBILITIES

GENERAL RESPONSIBILITIES

The NonProfits’ United Board of Directors is responsible for formulating and adopting the policies that govern the pool. Correspondingly, pool staff is responsible for implementing these Board policies and the regular management of the pool. In order to successfully develop policies, the Board must be an independent decision-making body and must distinguish between policy development and operation or implementation. While the Board should establish operational guidelines, it should not be involved in the day-to-day business of the pool. These operational guidelines include:

• adopting a mission statement and establishing the pool’s goals and objectives
• establishing service priorities
• developing minimum performance standards and methods for monitoring compliance from third party service providers
• conducting periodic due diligence checks of contractors, staff and other service providers
• adopting evaluation criteria for the Executive Director

SPECIFIC RESPONSIBILITIES

In order to establish thoughtful and consistent policies that meet the pool’s needs in a changing environment, directors must have some knowledge of the insurance industry as well as the needs of nonprofits. Directors must also be familiar with the pool’s history and all pool documents. Familiarity with the following areas is important:

• Insurance Terminology
• The Pool Structure
• Organizational Documents
• Committee Responsibilities
• Current Board Policies
• Pool Services

INSURANCE TERMINOLOGY - Both staff and service providers will present information to the Board using the language of the insurance industry. As an alternative to traditional insurance, we make every effort to use plain English whenever possible but specialized information and issues will sometimes require use of industry-specific terms. Directors must be somewhat familiar with these terms in order to make effective, well-informed decisions.

POOL STRUCTURE - A director should read and understand the Liability and Physical Damage Memoranda of Coverage, know the excess insurance attachment point, excess carrier(s) and Best ratings, be conversant with premium rate proposals, the pool’s aggregate stop loss coverage and catastrophic loss coverage.

ORGANIZATIONAL DOCUMENTS - A director should read and understand the following:

• Enabling Legislation and California Corporations Code
• Board Code of Conduct
• Mission Statement
• Member Agreement
• Corporation By-laws
• Risk Management Standards
• Investment Policy

COMMITTEE RESPONSIBILITIES - A director should be familiar with the tasks and issues facing all committees to which he/she is assigned. Since certain committees have more responsibility than others and some committees have particularly busy seasons, make sure you can meet the demands of a committee before agreeing to participate. The pool needs your commitment as well as your ideas. Please refer to the attached outline of tasks for each committee.

CURRENT BOARD POLICIES - A director should read and understand current Board policies so that contributions to policy development and adoption will be made in a cognizant, thoughtful and consistent manner which compliments the goals and objectives outlined in the pool’s mission statement and organizational documents.

COMMITTEE RESPONSIBILITIES

EXECUTIVE/PERSONNEL

• Negotiate employment contract with Executive Director
• Evaluate the Executive Director
• Establish and maintain personnel policies
• Establish new staff positions and salary ranges

FINANCIAL SERVICES

• Review, adopt, and administer annual budget and mid-year budget review
• Review and adopt financial statements
• Review and adopt annual audit and management letter
• Establish, monitor, and review investment policy
• Establish financial guidelines to assure pool security
• Review monthly claims summaries
• Review and adopt rating models for loss fund contribution and reserve adequacy
• Establish and adopt excess insurance terms including limits, coverage, policy form and conditions
• Negotiate contract with Broker of Record and Third Party Adjuster through Executive Director
• Establish performance criteria and monitor performance of Broker of Record and Third Party Adjuster through Executive Director
• Approve aggregate distribution for annual Excellence in Safety Awards

MEMBERSHIP

• Establish and review underwriting criteria for selection and retention of members
• Develop and review loss control programs
• Establish and review minimum risk management standards
• Establish membership risk management standards compliance and enforcement procedures
• Approve or deny driver exclusion appeals
• Establish levels of claim settlement authority
• Review and evaluate settlement requests above established authority
• Review reserves practices and claims payment trends
• Review and adopt periodic claims audits
• Analyze, understand, and evaluate insurance and nonprofit marketplace
• Contact potential members to discuss the pool and educate as necessary
• Actively seek new members and new markets for pool membership

PLANNING

• Establish and review pool mission, vision, goals and objectives
• Engage in long range and strategic planning including service development and pool growth
• Represent the pool at professional and related industry functions