[Kzyxtalk] "Uninsurable Risk"

[Scott Peterson]

Dear Mr./Ms. SM,

I was wondering if you could help me out with something. I was looking 

at ways for MCPB Directors and Officers to get insurance coverage. You

know. Just in case there's a big fat lawsuit. I think that Mr. John Sakowicz

brought this up a couple of years ago. And that MCPB didn't have any

such coverage. So I went looking for it. But ran into this:

http://www.investopedia.com/terms/u/uninsurable-risk.asp

It's called 'Uninsurable Risk': "A hazard or condition that has a high

likelihood of loss, or in which the insurance would be considered against

the law. Insurance companies limit their losses by not taking on certain

risks that are very likely to soon result in a loss." 

In fact -- at least according to Mr. Sakowicz -- the absence of Directors 

and Officers coverage is one of the factors leading to an FCC complaint

that drained MCPB of $30,000+ in attorney fees. Surely if MCPB were 

adequately insured, the insurance company would have paid for it.

Given that MCPB appears to delegate important functions -- such as 

the review of Form 990s -- to non-voting directors, what would be the 

incentive for any insurance company to cover voting directors here?

Sincerely,

Scott M. Peterson

Mendocino

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