Insurance

Risk management is a vital (and legal) responsibility for charity trustees. This page covers an introduction to the risk management process and the role insurance plays in protecting your organisation.

Risk management is a key tool for protecting organisations, volunteers and service-users. Charities need to manage risk like any other business.

Charity cover is one way of managing or transferring risk alongside other strategies like outsourcing, avoiding or minimising risk. Insurance is just one stage in the risk management process and irrespective of insurance cover, risks still require careful and considered management.

Charity insurance basics

There are many types of charity insurance that may be relevant, depending on your organisation’s size, complexity and activities.

Our trusted supplier Zurich Insurance has created a PDF guide which helps make buying insurance simple. The guide includes information that helps you consider: 

• When your organisation should consider public liability insurance
• The legal requirement for employer’s liability insurance if you have employees
• Insurance for your vehicles or vehicles your volunteers are driving
• Protection for your trustees such as trustee indemnity insurance

For more information, visit our help and guidance about getting insurance for volunteers.

It is also important to regularly review your charity insurance policy, especially when renewing.

Charities and risk management 

The fundamental questions for charities when assessing and managing risk are:

• What might you lose or suffer? (the event)
• How likely it is that the event could materialise? (the frequency)
• How much can you afford that event occurring (the impact)

The risk management process involves identifying, registering and assessing risk, contingency planning and developing a robust business plan, purchasing appropriate charity insurance and regularly reviewing risk at board level. You can read a series of risk guides by Zurich Insurance or NCVO’s managing risk page.

When identifying and assessing risks to your charity or non-profit organisation, you may find a brainstorming exercise useful. Consider each department, service and activity and work out the risks from there; don’t forget to include a range of people from across the organisation to maximise the risks you identify. Some areas you may wish to consider include the following.

• preventing fraud in charities
• charity risk assessments
• running events safely
• safe charity collections
• data security
• young volunteers insurance
• overseas travel insurance
• trustee liability insurance
• risk management policies and procedures

The Charity Commission’s guidance Charities and Risk Management (CC26) suggest categorising your identified risks into the following.

• governance
• external
• regulatory and compliance
• financial
• operational

Further support

Our trusted supplier Zurich Insurance can provide many different types of insurance cover, and provide risk management support.