Better safe than sorry: keeping your organisation right in 2012
As we enter into the New Year many people will have adopted New Year’s resolutions aimed at achieving a new goal or beginning a new activity. Perhaps a resolution that your organisation can make in 2012 is to ensure that it holds adequate insurance cover for its activities and enterprises.
Many organisations fall into the trap of assuming that insurance is only necessary in the event of an accident occurring or an activity going wrong. However, appropriate insurance coverage is important to protect your organisation’s assets and reputation. The organisation’s insurance cover should be reviewed at least annually and this should be an agenda item at meetings of the management committee, with an accompanying written report including the risks covered under each policy. This process can be carried out hand in hand with the broader consideration of the identification and management of the risks associated with the organisation’s activities – see below.
The management committee are under a legal duty to safeguard the assets of the organisation and should ensure that the appropriate insurance is taken out to protect the full value of the assets of the organisation. Employer’s liability and public liability insurance should be considered compulsory, and the following types of insurance should also be considered:
• Trustee Indemnity Insurance
• Personal Accident Insurance
• Buildings Insurance
• Consequential Loss Insurance
• Accidental Damage Insurance
• Legal Expenses Insurance
• Wrongful Advice and Information
• Fidelity Insurance
In considering insurance cover, the management committee should consider what is necessary in light of the organisation’s activities and whether the premiums are affordable. It is often best to take advice on these issues from an appropriate professional, e.g. a financial adviser or insurance broker.
Further guidance on insurance is available at http://www.nicva.org/sites/default/files/AN12-Insurance.pdf. NICVA can also provide some advice and signposting. If you are interested in this advice, please contact our membership officer, Mrs Frances McAtamney on 028 9087 7777.
As mentioned above, developing sound risk management procedures for the organisation is key to deciding on the appropriate type and level of insurance cover. Effective risk management procedures build the identification of risk into the activities of the organisation. The idea of risk is broader than simply health and safety (although this is of course vitally important) and also covers governance, financial and operational risks to the organisation. An effective risk management strategy will assist the management committee to safeguard both the assets and interests of the organisation and so ensures that the objectives of the organisation continue to be fulfilled.
You may find this simple step by step guide useful in developing an action plan to consider risk management.
Stage One – Establish risk policy
Stage Two – Carry out risk assessment
Stage Three – Identify risks and controls
Stage Four – Risk analysis – 5 steps to risk assessment http://www.nicva.org/sites/default/files/AdviceNote13RiskAssessmentFeb10.pdf.
For further guidance on risk management and assessment you can contact a member of the Governance and Charity Advice Team at NICVA on 028 9087 7777.