With three-legged races, popcorn machines, and more, most PTO volunteers see a carnival as a festive way to boost school spirit, raise some money, and, of course, have a little fun. But from where insurance providers sit, that same carnival looks more like a little shop of horrors.

The three-legged race? A chance for someone to get hurt, perhaps seriously. The popcorn machine? A fire hazard.

From the big endeavors like gifting playgrounds to the seemingly innocuous ones like allowing students to buy inexpensive gifts at a holiday shop, the experts see trouble. Someone could fall off one of those swings, choke on one of those gift items. They’re not being hysterical or alarmist. Those things—while infrequent—have happened.

PTOs and PTAs should be insured, not only to protect against injuries and damages at events that they sponsor but also to protect themselves against embezzlers. Even if the parent group itself is short on cash, someone filing a lawsuit may decide to name officers who seem to have more personal assets.

Many volunteers seem to take a head-in-the-sand approach, thinking, “Well, I’m a volunteer so I can’t be sued” or “We’re just a simple parent group. Who would embezzle from us?” The trouble is that anyone can be sued, and parent groups across the country have been victims of theft more times than we care to remember. Lawsuits require attorneys. Missing funds can be terribly difficult to replace.

And while many parent group leaders assume (or are told by a school administrator) that their group is covered by a school or district insurance policy, experts strongly recommend that parent leaders confirm that assumption before taking a large risk.

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Do We Really Need Insurance?

Melissa Repetski, outgoing president of the Boyette Springs Elementary School PTA in Riverview, Florida, considers insurance “a must.”

“I’d be scared to hold an activity without it,” she says. Because the state PTA encourages local groups to take out insurance, the Boyette Springs group has a liability policy that costs about $300 a year and has bonded its president and treasurer at approximately an additional $100 a year. “With all the cases of embezzlement going around, I see the point,” Repetski says.

The fact is that anyone can sue anyone else at any time. While not all suits have merit, in this increasingly litigious time, a modest insurance investment can certainly lead to peace of mind and—if the worst case does happen—protection.

Because insurance is regulated by states and not by the federal government, the rules vary from state to state. In some states, for instance, school districts are specifically forbidden from covering PTO events under their insurance. In other states, the decision is left up to the school districts.

The best way to find out whether your parent organization is covered under the school’s policy is to ask the school district’s business manager. Be specific; if your group is covered by a school policy, ask what that includes—parent group meetings, family events such as carnivals, and so forth—and whether it applies to activities on or off school grounds.

Your best bet, though, is to ask for written confirmation of coverage from the district’s insurer. If you can’t get proof of coverage during good times, what will happen on that dark day when an accident happens?

Which Policies Should We Purchase?

Once a parent teacher organization has made the decision to purchase insurance, there are several things to look for. The PTO Today Plus insurance program, which has a particular focus on all types coverage for school parent-teacher groups, offers five different options.

General liability insurance covers injuries that occur at events sponsored by your parent group. On general liability policies, be sure that all volunteers are covered.

The second type of coverage is excess accident medical coverage, which helps avoid lawsuits by paying for out-of-pocket medical expenses if someone is injured. Excess accident medical insurance provides excess medical coverage to participants at PTO-sponsored events if someone is injured. The coverage pays for medical expenses beyond those covered by any primary medical insurance that the participant (or the participant’s guardian, in the case of a minor) may have in place.

The third category is directors and officers liability coverage. Officers liability coverage is truly an investment in the leaders of your group. These leaders who put in so much volunteer time are also exposing themselves to greater risk. Their decisions as leaders could be called into question in a lawsuit (“Why did you decide to use that vendor?”), and D&O insurance is designed to protect them in that case.

Next is crime coverage, which protects from embezzlement or theft of the parent group's money. Some policies require the treasurer and/or president to be named individually each year, but blanket policies (such as that offered through PTO Today's insurance program) don’t require that.

Finally, there’s property coverage, which protects parent group property, including fundraising merchandise, against damage or loss due to theft or natural disasters as long as the property is stored at school in a locked area. If that copier you purchase for your PTO is ruined in a flood or that $20,000 shipment of candy melts due to a refrigerator power outage, then your relatively inexpensive property coverage could come in handy.

The PTO Today Plus Advantage

PTO Today Plus groups have a great option through the PTO Today Plus Parent Group Insurance Program. Access to this comprehensive insurance package is a key benefit of PTO Today Plus membership. Most PTO Today Plus members save more on insurance alone than the cost of an annual membership fee.

PTO Today has partnered with a carrier that’s been rated A by A.M. Best, an independent, third-party organization that rates financial and insurance institutions.

It’s a compelling program and a wise investment. Insuring your group, your volunteers and your leaders means that you’re serious about your parent group work. Your volunteers—and especially your leaders—are putting their hearts and souls into your PTO, and they shouldn’t be faced with a personal liability should the worst occur. And a quick review of PTO news in recent years shows clearly that no group is immune from the dangers of theft or embezzlement.

Being a PTO or a PTA or any other kind of community group is no shield against a lawsuit or a loss. Insurance protection—especially at a group-discounted price—can make all the difference.

Download the info sheet for more information about PTO insurance.

Originally posted in 2001 and updated regularly.