Indemnification Policy - Risk Management

Applicability
This Policy applies to current and former members of the Board of Trustees and University employees, including officers, faculty, staff, and student employees. Volunteers will not be eligible for indemnification under this Policy unless they have formalized their relationship with the University in accordance with the Professional Affiliate Policy and its associated procedure. The University may, in its sole discretion, extend indemnification to other individuals based on the specific circumstances of an event or claim. 

Policy
Northern Michigan University (hereinafter the University) will defend and indemnify the above described individuals who have a legal action, claim, or proceeding arising from the reasonable and good faith performance of their authorized duties carried out on behalf of, or at the direction of, the University. This Policy does not apply to internal University proceedings.

Indemnification includes coverage for expenses reasonably incurred in connection with such legal action, claim, or proceeding, including attorney's fees, judgments, penalties, fines, insurance deductibles, and amounts in settlement actually and reasonably incurred. In proceedings in which both the University and an employee are parties, the University retains sole discretion to determine whether a conflict of interest exists that necessitates separate legal representation for the employee. If so, the University will provide such representation.

The University may revoke its initial decision to defend and indemnify an individual if subsequent information reveals that a required condition of this Policy was not met. In such cases, the University may seek restitution for expenses already incurred, including attorney’s fees. The University, through its office of Risk Management and in consultation with the University General Counsel, may, but is not required to, issue a Reservation of Rights letter to reserve the right to revoke indemnification.

As a condition of defense and indemnification, the trustee, official, employee, or student must fully and continuously cooperate with the University’s legal counsel and the Risk Management Department. The University retains sole discretion to select legal counsel and manage the defense. Individuals may choose to retain separate counsel at their own expense, in which case the University will not provide indemnification for any related settlement, judgment, or expense incurred.

Indemnification will be made only to the extent that the individual is not made whole through other sources, including insurance. To the extent permissible, all other non-University insurance coverage will be filed as primary coverage; the University’s coverage will be applied on an excess basis. In no case will indemnification exceed the total actual and reasonable expenses incurred, including attorney's fees, judgments, penalties, fines, insurance deductibles, and amounts in settlement.

The authority to apply or revoke this Policy rests with the President of the University. Appeals regarding the President’s decision shall be presented to a panel consisting of the President, University Counsel, and a member of the Executive Committee of the Board of Trustees.

For legal proceedings involving the President or any member of the Board of Trustees, the authority to apply or revoke this Policy lies with the full Board of Trustees. In such cases, the Executive Committee will make a recommendation to the full Board of Trustees, whose decision shall be final. 

Related Policy:
Professional Affiliate Policy at https://nmu.edu/policies/1096
Appointment to External Organization Policy at https://nmu.edu/policies/706 
Voluntary Civic Engagement Policy at https://nmu.edu/policies/727