Charitable donations peak during November and December according to research conducted by the CAF. Unfortunately, not everyone is in the giving mood and instead target charities from the inside. The National Fraud Intelligence Bureau (NFIB) released a national alert earlier this year highlighting the insider threat of fraudsters and cybercriminals to charities with statistics that are an eyeopener to the amount of insider fraud that occurs year in year out across an overwhelming number of charities.
In an effort to provide heightened clarity of the duties and responsibilities for Charity Trustees, in July 2015 the Charity Commission updated its guidance on the administrative and legal duties which should reasonably be expected of those undertaking this role.
Whilst adhering to the six key guidelines below cannot guarantee that trustees will not be subject to Trustees Indemnity Insurance claims under a Charity Insurance policy, they will certainly help in reducing exposure as well as assisting in defence of any action which may be raised.
The tens of thousands of charities and not-for-profit organisations throughout the UK face many risks that can result in loss, damage or liability risk, both for the charity as a whole, and the trustees.
Typical risks include damage to a charity’s property, loss of a charity asset or resources, and third party liability for public liability or professional indemnity exposures.
Part of mitigating these risks is having an appropriate Charity Insurance Policy. The following is a brief guide of different covers that typical charities should consider, but you should always take expert advice on your own individual and specific risks and exposures.
As a charity or social enterprise it is your organisation’s duty to protect the safety of all your members and volunteers, particularly your youngest members. Failure to implement a robust monitoring and safety programme could lead to accusations of misconduct or abuse and subsequent claims under your Charity Insurance policy.
Any organisation needs good governance and structure to prevent dissolution. Charities and not-for-profits, with their tight budgets and limited resources, are especially in need of judicious governance that prioritises the needs of the organisation. Whilst larger charities may employee staff to manage processes effectively, these matters can often be overlooked in smaller organisations.
Failure to deliver and document processes and structure effectively can also lead to legal challenges against Trustees and potential Trustees Liability claims under your Charity Insurance policy.
Working as a trustee for a charity can be a very rewarding experience and provides opportunities for skill development, networking as well as helping the community. As a member of the board of trustees, you have a duty of responsibility for the affairs of the charity and for delivering the outcomes it was intended to create.
Although the majority of trustees are volunteers, there is a still a certain amount of risk involved in holding one of these positions. Even when acting in good faith, you could be held personally liable for your business decisions, as such, it is important that your Charity Insurance policy provides adequate protection.
Fireworks are an indispensable part of celebrations such as Bonfire Night and New Year’s Eve. When your charity or community organisation puts on a special event with fireworks, you need to take precautions to reduce the risks and keep your employees, volunteers and spectators injury-free. You should also ensure that your have adequate Community or Charity Event Insurance, which will include Public Liability Insurance to protect against your legal liabilities should a member of the public suffer injury or damage to their property.
Many charities rely on volunteers to help fill out their workforce and keep costs low. Volunteers are often asked to complete a variety of tasks, including driving.
However, enlisting volunteers can also create additional responsibilities — You must manage all foreseeable risks, secure volunteers’ safety and ensure your charity possesses the proper insurance cover, when you then add vehicle use to this and managing your risks may seem overwhelming.
But you need not fear using volunteer drivers as long as your Social Enterprise has adequate Charity Insurance or CIC Insurance cover.