Associations Liability Insurance

From Industry Associations, Not for Profits to Community Service Organisations, Associations’ typically intend to make a positive contribution to society.

While many of the Officers of clubs’ organisations may be voluntary, the very nature of the human interaction that occurs within and Associations means that the assets of both the Association and Directors could be subject to claims.

Association Liability Insurance may provide vital protection, helping shield your organisation from claims that may arise from the decisions and actions of its officers, directors, employees, and volunteers.

What is Association Liability Insurance?*

Association Liability Insurance is designed to cover a broad range of risks unique to not-for-profits, professional associations, clubs, and other organisations.

Associations could be sued due to a number of reasons, such as, employee theft, work health and safety issues, misuse of assets, discrimination or harassment and mismanagement of the association.

This type of insurance may protect associations and their management against the financial impact of claims.

Who Should Consider Association Liability Insurance?*

Associations, charities, clubs, and non-profit organisations may benefit from Association Liability Insurance. This cover may be beneficial for organisations involved in activities that include members, stakeholders, in person or online events and meetings, managing funds, advising or consulting, or employing staff.

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What May Be Covered? *

Directors and Officers (D&O) /Management Liability: Association Liability Insurance may cover claims brought against directors, officers management due to alleged wrongful acts, such as breach of duty, neglect, or mismanagement. Without D&O coverage, directors and officers may be personally liable for certain claims, posing significant personal financial risk.

Employment Practices Liability: If a current or former employee makes claims related to employment practices—such as harassment, unfair dismissal, or discrimination—this coverage may provide support.

Professional Indemnity: Coverage may extend to claims arising from errors or omissions in the professional services your association offers.

Fidelity and Crime Coverage: Some policies may cover loss from dishonest acts such as theft or fraud committed by employees, volunteers, or even external parties.

Fines and Penalties: This section may indemnify associations for fines or penalties that may result from wrongful acts. Importantly, the wrongful act must not be intentional, wilful, reckless, or deliberate.

Tax Audit: This may provide coverage for associations’ professional fees (such as accountant fees) if the association is subject to an official tax audit.

Why Might Your Association Need Liability Insurance?*

Running an association involves various duties and decisions that may affect members, employees, and the community. Association Liability Insurance may help protect your organisation, directors, office bearers and employees from the financial burden of legal costs, damages, and settlements. Without suitable cover, associations and its leaders may face risks that could potentially impact their financial stability or reputation.

Key Features of Association Liability Insurance*

Legal Defence Costs: Association Liability Insurance often includes cover for legal costs associated with defending against covered claims.

Settlements and Judgments: Policies may cover settlement amounts and judgments if your association is found liable in a claim.

Protection for Officers, Directors, and Employees: Coverage generally extends to protect individuals acting in management or advisory roles within the association.

Additional Policies Associations May Consider Beyond Association Liability

Volunteer Accident: Many associations engage volunteers for various activities like event set-up, sausage sizzles, and more. Volunteer accident insurance may offer financial compensation if a volunteer sustains an injury or fatality. This type of cover may include lump sum benefits, weekly payments, non-Medicare expenses, and other support options.

Public & Products Liability: This policy may provide protection against claims for third-party injury or property damage connected to the association’s activities. For instance, if an event hosted by the association results in attendees slipping, tripping, or falling, this cover may help address resulting claims.

Cyber Insurance: Cyber insurance may offer protection for the association in case of a cyber-attack, including coverage for penalties related to privacy breaches, financial loss due to cyber fraud, legal expenses, revenue loss, and more. Associations that handle personal information could be at risk of cyber-attacks.

Business Pack: This type of cover may protect the association’s property and related risks. Coverage may include protection for contents or stock damage at the office due to events like fire or storms, glass breakage, theft, and business interruption.

Factors to Consider When Choosing Association Liability Insurance*

When considering Association Liability Insurance, assessing the scope of coverage, policy limits, and any exclusions is important. A Smart Business Insurance broker may help tailor the insurance to your specific needs and ensure that your association receives relevant protection.

Why Work with a Specialist for Association Liability Insurance?*

Associations have unique requirements that may differ significantly from those of other organisations. By working with an insurance broker who understands the risks and legal obligations of associations, you may gain valuable insights and assistance in customising the right cover.

For further guidance on Association Liability Insurance, connect with a Smart business insurance broker who can help you understand the options available and select a policy that aligns with your organisation’s activities and needs.