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In an increasingly litigious society, people seem poised to sue at the drop of a hat. Many believe that big brands have a lot of financial clout behind them, but this is not always the case for charities. The cost of defending a claim, not to mention the cost of losing and having to pay damages, could seriously affect your charity and reduce its capacity for doing good.
It may feel like we are treading on eggshells to avoid a court case, but there is no need to swaddle everyone, and everything, in bubble wrap. Simply understanding what your organisation could be liable for and picking out the best insurance policy will protect you, and your purse, in the event of a claim. Accidents do happen and, no matter how minor or genuine the mistake, you will have to pay compensation, so make sure you are covered for all eventualities. Don’t wait until a claim arises to discover your policy is not as inclusive as you’d hoped.
Your organisation could be liable for claims made against your employees, volunteers or trustees following acts of negligence, abuse or malpractice that caused physical or psychological harm to the claimant, or the loss or damage to their property or finances. These claims can be raised by employees, clients, or members of the public. Youth charities are particularly vulnerable, as children are generally more accident-prone. For example, a curious child may cut their finger by poking it through the protective cage of a spinning fan, or youngsters raising funds by washing cars may accidentally scratch some expensive paintwork.
First, ask yourself what liability cover your organisation may need. The following checklist should help guide you, but if there is any uncertainty, feel free to call on one of Unity’s expert brokers.
If you, your staff or your members interact with people in public or external organisations, then it is strongly recommended to have Public Liability Insurance. This covers the cost of compensating third parties for any injury, illness, death, or damage to their property caused by anyone acting under your organisation. Although Public Liability is not a legal requirement, some situations, such as using other premises for your charity work, may demand it nonetheless. If you work with young people, you should check that your policy includes abuse cover.
If someone has an accident on, or relating to, your premises, you could be liable for the damages. Property Owner’s Liability Insurance covers this, though check first that it’s not already included under your Public Liability policy.
If someone suffers an injury or illness from anything your organisation makes, gives, sells, or supplies, Product Liability Insurance can cover the costs of compensation. But it’s always worth ramping up the quality control checks to avoid future incidents.
In the digital age, we are all exposed to cybercrime. If you hold databases of personal information you should consider Cyber Liability Insurance to cover the cost of security breaches, the loss of third-party data or cyber extortion.
Providing guidance and training is at the heart of many charities, but brings a burden of responsibility. Professional Indemnity Cover can protect you if someone claims they suffered a financial loss because you advised them incorrectly even if you had good intentions.
Whether you take on temporary volunteers, work-placements, or full-time staff, the law requires you to have Employer’s Liability Insurance to cover any injury, illness or fatality that occurs through their work for you.
Taking out cover specifically for your Trustees, Directors and Officers will protect your key decision makers if their actions caused losses to the charity. However, there is no protection for anyone who acted fraudulently.
Not all liability insurance policies are the same.
As a specialist insurance broker who understands how charities and voluntary organisations work and their risks, speak to our insurance experts so that you get the right cover.