Monday, 27 October 2014
What is Trustee Indemnity Insurance? - By Martyn Turner, Charity Underwriting Director, Ecclesiastical Insurance
Ecclesiastical Insurance have contributed a series of blogs for Trustees' Week. Today's blog, one of three, tackles the question of 'what is trustee indemnity insurance?'
People become trustees for many different reasons. Some do because it represents a cause close to their heart, whereas others may see trusteeship as the opportunity to become more involved in the strategic direction the charity takes. The trustee has a similar responsibility to that of a director of a company.
By becoming a trustee you have made the decision to volunteer your time to make life better for others. The last thing on your mind will be insurance and why would it be! However trustee indemnity insurance is something you need to think about and understand, because trustees have legal responsibilities and can be held liable for the charities actions.
As a charity trustee, it makes sense to protect yourself and give yourself peace of mind that should something go wrong, someone is there to help you. Trustee indemnity insurance is like a reassuring safety net so that if a trustee makes an honest mistake the insurance cover can protect them.
So what types of things are covered under insurance?
• Claims arising as a result of improper investment
• Awkward legal situations
• Allegations of defamation.
There are some restrictions that you need to be aware of as there are some things you won’t be covered for, for example:
• Reckless acts
• Criminal fines or penalties imposed by public authorities
• Convictions for fraud or dishonesty.
You are now probably wondering – how do I get cover? Well, trustees are able to buy cover out of their own pocket; but remember to check with your charity as you may already be covered under their insurance. If you need further details on your policy please contact your insurer or speak to a specialist broker.
If you are unsure about trustee indemnity insurance or you need more information please visit the Ecclesiastical Insurance website for more information or tweet us @Ecclesiastical.
Next Monday we will be blogging about the responsibilities of a charity trustee so make sure you come back and take a look.
Posted by Trustees' Week at Monday, October 27, 2014