Controls on what you can do

Insurance

Insurance

Buildings, and public liability insurance are regarded as essential for any organisation but particularly in the case of unincorporated organisations where those involved do not have the benefit of limited liability.

  • Where you hold your property under a lease of space forming part of a larger building (a lease of part) it is highly likely that the landlord will have agreed in the lease to insure the building, subject to your paying a proportion of the insurance cover.  A lease of part should provide that you will have the benefit of the insurance even if an insured event arises because someone under your control has been neglectful.  This will generally be implied if you contribute to the premiums.  [Service charge]
  • This arrangement is not always the case with very short term leases and is rarely the case with occupation licences.  There is often a rental charge that includes insurance costs.  Organisations should ensure that any liability for repair under such agreements does not extend to things that are covered by the landlord’s buildings insurance.
    If anyone threatens legal action against you, you should always check your insurance policies and your landlord’s policies to see if the risk is covered or whether you have general insurance against the cost of claims.  [When you are accused of breaching something]
  • Where you are aware that something has occurred that may be covered by insurance it is essential to contact your insurers as soon as possible because late notification of an insured occurrence can invalidate a claim.
  • Sometimes cover will be arranged under a one-off premium to cover claims from those who might have property rights over your property, most commonly in respect of restrictive covenants. [Restrictive covenants]
  • Insurance does not absolve organisations and their directors or trustees from their obligations to observe legal requirements and best practice.  It is not possible to insure against liability for criminal actions, which can be a risk in connection with property activities by charities.
  • If there is any material change to your building or how it is occupied or used you should consult with your broker regarding whether or not your insurer should be notified.