NCi Charity realise that the insurance industry can sometimes be tricky to grasp with many insurance brokers or insurance companies seemingly stuck in the past and using jargon which often makes no sense at all. NCi Charity aren't one of these brokers and our aim will always be to explain things to you in a language you understand. Here are just a few terms that often come up when dealing with charity insurance and insurance for organisations in the not-for-profit sector along with a brief description of what they actually mean:

Voluntary Organisation:

An organisation whose staff are unpaid have charitable aims & objectives but are excepted, exempt or ineligible for charitable status.  This can be extended to include organisations where staff are paid but the organisation is not-for-profit.

Community Group:

A group of individuals which is not open to the general public.  For example a youth club, ladies club, religious community, etc.

Registered Charity:

Group or organisation which is registered with the Charity Commission under law in England & Wales (http://www.charity-commission.gov.uk).  The charity will have a charity number and will have to submit accounts to the commission annually.

Limited by Guarantee:

A company limited by guarantee is an alternative type of incorporation used primarily for non-profit organisations that require corporate status. A guarantee company does not have a share capital, but has members who are guarantors instead of shareholders. The guarantors give an undertaking to contribute a nominal amount towards the winding up of the company in the event of a shortfall upon cessation of business. It cannot distribute its profits to its members, and is therefore eligible to apply for charitable status if necessary. Common uses of guarantee companies include clubs, membership organisations, sports associations and charities.

Applying for Charity Status:

This description is used for a voluntary organisation, community group or company limited by guarantee who have submitted an application to register as a charity.

Child Protection Policy:

This is a document which sets out your organisation’s procedures in the event of a child protection issue arising (allegation, notification or suspicion of abuse, neglect, etc) and also who the child protection officers are.  It may also contain a framework for providing activities to young in a safe environment.

Criminal Records Bureau Check/Enhanced Disclosure (CRB):

This is a background check, carried out on behalf of the organisation by the Criminal Records Bureau.  It is a legal requirement that all adults (18 years and above) who work directly with children or vulnerable adults have this background check carried out.  For volunteers the check is free, for employees checks need to be paid for.  It can take some time for the checks to come back to the organisation so it is imperative that at least some of the adult staff have them within your organisation when you start operating.

Most insurers will decline to quote if there are an insufficient number of staff with these checks carried out within your organisation.

More information can be found here: http://www.crb.gov.uk

Children:

Anyone under the age of 18.

Vulnerable Adults:

Are defined as 'a person aged 18 years or over, who is in receipt of, or may be in need of, community care services by reason of 'mental or other disability, age or illness and who is, or may be unable to, take care of him or herself, or unable to protect him or herself against significant harm or exploitation'.

Volunteers:

Members of staff in an organisation, company or charity who work for that organisation but receive no remuneration.

Employees:

Members of staff who are employed by an organisation, charity or company who receive remuneration for the services they provide. This can include labour only or bona-fide sub-contractors, students on work placements and temporary staff.

Trustees:

Trustees in this case means charity trustees. You are a charity trustee if you are:
the trustee of a charitable trust (charitable trusts can be created by a declaration of trust or by someone's will);
the director of a charitable company (a charity that is a company with a memorandum and articles of association as the document which sets out how the charity is to be run); or
a member of the committee which is responsible for running a charitable group such as a community association or a parent teacher association. Positions can include tresurer, secretary and chairman/president.
As a charity trustee you are responsible for the general control and management of the charity. Because of this you may be known as a ‘managing trustee’.

Members:

This is a broad term in charity insurance and can mean any of the following: number of children in a youth club, members of a charity mailing list or the number of paying subscribers or supporters in a charity.

Public Liability:

Public Liability covers your organisation’s legal liability to a third party for property damage or personal injury.  This cover is often described as an ‘open cover’ as it is only restricted by notified endorsement and the policy wording.  It can, therefore, protect the organisation from claims from members of the public and its own members.  When people refer to ‘charity insurance’ or ‘charity event insurance’ they often mean public liability as this is the core cover in most policies.

Employer’s Liability:

This is a legal requirement for all organisations that employ staff (as defined above) under the following acts of parliament: Employers’ Liability (Compulsory Insurance) Act 1969 & 1998.  This part of an insurance policy covers your legal liability to your employees.  Examples of this cover include accidents at work where the employer has been negligent or committed a breach of trust.  In charity insurance policies this cover can also be extended, or automatically includes, cover for volunteers – hence it is sometimes referred to as volunteer insurance.

Professional Indemnity:

This form of insurance covers an individual or organisations in cases of negligent acts, errors, omissions or breaches in professional duty that result in injury or loss.  It is most commonly taken out by solicitors, insurance brokers, accountants and other professionals.  It may be of interest to charities or similar organisations that provide advice, distribute a third party’s money as funding or are involved in advocacy.

Trustees Indemnity:

Trustees Indemnity protects the trustees against the risk of personal liability, whether to the charity or a third party, arising from their breach of trust.  Any personal liability for their wrongful acts as a company’s directors or officers is also covered.

Abuse Cover:

What it covers: claims arising from the organisation negligently failing to prevent physical, mental, emotional or sexual abuse usually to children or vulnerable adults.