Everything you need to know about PTO insurance
You belong to a Parent Teacher Organization (PTO) for a very important reason: you want to support and improve your child’s school community. You are able to raise money for supplies, field trips, uniforms and so much more. As well as meet like-minded parents who care just as much as you do.
When your PTO runs events like carnivals and picnics, you probably aren’t worried about PTO insurance. Yet it’s vital you and your group are protected against potential risks.
For example, despite all the good your organization does, there’s a chance any member of your board may be personally and individually named in a lawsuit if things go wrong.
All you want to do is make your child’s school better. So how can you avoid placing your group — as well as your future wages, earnings, and personal assets — at risk?
We’ve created this resource to give you all the information you need to know about PTO insurance in an easy-to-read question and answer format.
What is PTO insurance?
Association Insurance Management Inc. (AIM) makes it easy and affordable for your group to obtain quality PTO insurance, covering everything from:
– General liability and accident medical coverage in case of injury
– Protection for your property and funds from theft, embezzlement or loss
– Safeguarding directors and officers from legal action
To learn more about AIM and how we help PTO groups like yours, watch this video.
We’re just a parent group. Who would want to sue us?
PTO groups aren’t immune from liability because of their non-profit status. Plus, any individual member or officer could be held personally liable for an accident that occurs at one of your events. PTO insurance not only protects your organization but also protects you as an individual, especially when there is limited coverage through your homeowner’s insurance.
None of us can see the future. AIM’s PTO insurance coverage has been created to protect your organization and members from potentially catastrophic financial losses resulting from claims related to the various events organized by your PTO.
Isn’t my PTO covered under my school’s policy?
It depends, as every school is different. Some policies only cover the parent teacher group for events during school hours and on the school campus, while other school districts are removing PTO groups from their school’s insurance policy.
Our best advice? Give your school a very specific list of your activities. For example, instead of just saying you’re doing a carnival, list the exact activities in great detail, then get a written letter from the school stating which activities are covered.
When it comes to your PTO property, funds, and equipment, it is also important to ask your school what would happen if, for example, your popcorn machine was stolen.
Doesn’t our general liability insurance cover our PTO?
Most parent teacher groups don’t know what coverage they have. They often don’t know what risks those policies are protecting them from either.
Think of it this way: You wouldn’t expect your Homeowners Insurance Policy to pay if you were in an automobile accident or your Health Insurance Policy to pay if your house burned down. Each one of your personal insurance policies does something totally and distinctively different. The same thing is true concerning PTO insurance policies.
What are the four types of PTO insurance?
Each protects your organization in different ways.
PTO Insurance for Your Events: This general liability insurance protects you from lawsuits in the unfortunate case of someone being injured at one of your PTO group’s activities and holding you responsible. This includes events such as carnivals, galas, fun runs, and cookouts. Whether you choose one-day event insurance or annual event insurance coverage, AIM covers you with:
– $5,000 Medical Payments limit is included in every General Liability policy. Options for increased Medical Payments limits are $10,000, $25,000, and $50,000, with no deductible.
– $1,000,000 or $2,000,000 liability limits with no deductible
– Protection from lawsuits if someone was injured at one of your organization’s activities and held you responsible
– Social Media liability is also available as a supplement of your General Liability policy.
To learn more, watch this video.
Embezzlement Insurance: This bond coverage insurance will cover the money of your organization should it be stolen or embezzled. This means it protects the money even if it’s stolen by your president, treasurer, board member, volunteer, or even courier. Honesty is the best policy, but when people aren’t, our bond policy will replace stolen or embezzled funds. This PTO insurance also includes:
– Bond Coverage to replace any stolen or embezzled funds in case someone runs off with your organization’s money.
– Standard bond limits are $10,000, $25,000, and $50,000, with a $250 deductible — higher limits are available.
Watch this video for more information.
Directors and Officers Liability: Just like any business, your PTO needs to be protected from liability. If someone sues your officers for mismanagement, misrepresentations, dissemination of misleading information or any inappropriate actions, this coverage will pay for the defense.
– Directors and Officers Liability coverage protects the organization from lawsuits for “wrongful acts.”
– This coverage is also referred to as Professional Liability. The coverage limit is $1,000,000 with a $1,500 deductible.
This video has more information.
Property Protection: This Inland Marine (Business Personal Property) coverage protects your raffle merchandise, auction items, and fundraising supplies.
– The Inland Marine coverage limits are $10,000, $25,000, and $50,000, with a $250 deductible.
– This coverage also protects any property owned by your organization, such as popcorn machines, snow cone makers, school store supplies, emergency relief supplies, and more.
Want to know more? Just watch this video.
How much does PTO insurance cost?
AIM offers several PTO insurance plans, including:
– General Liability Insurance (Event Insurance) — Starting at $85 per year
– General Liability Insurance (One Day Event Insurance) — Starting at $50
– Fidelity Bond (Theft and Embezzlement Insurance) — Starting at $85 per year
– Property Coverage (Inland Marine) — Starting at $100 per year
– Professional Liability (Directors & Officers Liability) — Starting at $50 per year
To see if your organization qualifies and to get a quote online for one of the above plans — or a combination of several of them — just click this link.
Are there any supplements I can add to the General Liability policy?
Of course. We offer several ways to expand on your coverage:
Extended Medical Payments: While our General Liability policy includes a $5,000 provision for Medical Payments, if your claim goes above $5,000, the injured party could sue your PTO for any amounts incurred. The Medical Payments component provides additional coverage for out of pocket medical expenses and helps deter lawsuits.
Extended Medical Payments coverage is an endorsement to the General Liability and is only available in combination with General Liability.
Extended Medical coverage is available for purchase in the following increased limit options: $10,000, $25,000 and $50,000.
Media Liability: This supplementary coverage is designed to protect you from liability in the event you or your organization accidentally misuses or discloses information on your website or other social media site. This includes misuse of the logo, copyright, pictures, confidential information, and other misrepresentations or misappropriations. These are often innocent mistakes, but they can cost your PTO thousands of dollars.
Coverage Highlights: Invasion of privacy by posting a photograph that has not been released for use. Infringement of copyright, trademark, or logo, if you accidentally post something.
Media Liability is available for purchase in the following limit options: $25,000 $50,000 $75,000 $100,000
Terrorism: Under the Terrorism Risk Insurance Act, you have the right to purchase PTO insurance coverage for losses resulting from a Certified Act of Terrorism (certified by the Secretary of the Treasury).
Contact us with questions about determining if your organization needs Terrorism coverage.
How do I apply for PTO insurance coverage?
When does my coverage begin?
Your coverage can begin as soon as your application is approved, and the first payment is processed. Your certificate of coverage will be emailed within one week of payment.
Do you have PTO insurance coverage from another provider? No need to worry about a lapse in coverage or paying for two policies at the same time. We can schedule your PTO insurance to start at the exact moment your current coverage expires.
How do I report a claim?
AIM makes reporting claims incredibly easy:
1. Visit the Report a Claim section of our site.
2. Download the PDF form, which you can complete electronically with Adobe Acrobat Reader or print to fill out by hand.
3. Complete the form electronically or in paper form.
4. Submit the form to us via fax, mail, or email using the contact information provided in the form.
Doesn’t a liability waiver cover my PTO from lawsuits?
It is very important to be aware that you can never sign your liability away regardless of any document or waiver. A waiver will not hold up in court if you or your PTO are found at fault for an injury occurring at one of your events.
However, a waiver is a tool used to help deter the lawsuit mindset. By having all participants sign a waiver, you are helping to plant the seed that the participant is responsible for their own actions.
While a waiver isn’t a requirement to extend coverage under the General Liability policy, it is a step in the right direction to help protect your organization against bodily injury lawsuits.
Parent’s Approval and Student Waiver: Download this waiver anytime you need a person under the age of 18 to sign for a specific event.
Participant’s Waiver: This waiver is to be used anytime you want someone over the age of 18 to sign for a specific event.
For more sample forms, including parent/guardian approval waivers, hold harmless agreements, claim reports, auditing reports, gifting letters for property and money, additional insured forms and more, check out this page of our website.
I’m planning an event with my PTO right now. What events are covered and not covered by your policies?
We’ve created this page that lists plenty of options for your next event and which ones are covered, which are not, and which are covered but still present high risk to your event.
The AIM Fall Carnival video also provides a quick way to learn how to better plan and cover your next event, so your participants are safe and your organization is protected.
What are some examples of claims that AIM’s PTO insurance could protect my organization and its members from?
Event Insurance: At a Fall Carnival your PTO is running, a child is injured and their parents have no health insurance. Now, they are looking for someone to help pay the costs of an emergency room visit and follow-up appointments. Not only is your PTO at risk, but any volunteer directly involved could be named, putting their personal assets at risk.
Embezzlement Insurance: A member or an officer of your PTO takes money that was scheduled for a bank deposit.
Business Personal Property: Your PTO is selling candy for a fundraiser. The PTA room at your school was broken into over the weekend and all the candy was stolen. Despite this loss, your PTO still owes the candy company for the stolen product. This policy protects you when instances such as this occur.
Directors and Officers Liability: As with any business, the officers of your PTO can be sued for any decisions they make individually or as part of the organization. Whether those decisions are where to hold any event or what type of fundraiser your PTO will do for the holidays, these managerial decisions need to be protected. Other instances that might fall under this PTO insurance coverage are an inappropriate use of organization funds, wrongful acts, misleading statements, negligent acts, discrimination, not following your by-laws, and misrepresentation.
I have a question you didn’t answer…
Good news. The AIM website offers a Quick Reference Guides page, which features information on a variety of topics from Top 10 Ways to Help Protect Your Organization from Embezzlement to Top 10 Ways to Help Reduce Your Liquor Liability, Covered & Excluded Events, Reviewing Your Policies and more. We’re constantly adding new information to this page.
If our resources still haven’t addressed your concerns, you can email us with this form or call us at 1-800-876-4044.