Protecting your trustees

Not for profit organisation trustees can protect themselves and their assets through carefully assessing risks and potential solutions explain Hayes Parsons Insurance Brokers.

Whilst Public and Products Liability insurance, and Employers’ Liability insurance are reasonably well known, there is still much confusion around other insurances that help protect trustees. Here we uncover just a few other options that are available.

Trustee indemnity 

The Trustees are the ultimate body of people that carry the responsibilities of the charity and its activities. When accidental errors are made by them, or those they delegate to, they can become personally liable for those mistakes. Anything that has caused harm, distress, or financial damage to a 3rd party could lead to a claim being brought against an individual trustee.

If a claim was made against a trustee, they might face legal costs plus the cost of potential damages awarded. Trustee Indemnity insurance will help protect a trustee in many of these situations, bringing a greater degree of peace of mind for those serving as trustees. Sometimes you will hear this type of insurance called Trustee Liability Insurance, or Management Liability.

Entity defence

Entity defence insurance specifically covers the charity as a whole and is normally purchased when buying Trustee Indemnity insurance. It comes into play with an action brought against the charity as a whole, not an individual.

An example of the benefit of such insurance might be if someone died due to a workplace accident, and the Crown Prosecution Service might then charge the charity with corporate manslaughter. The insurance would kick in to help defend the charity in court. Other examples include breach of contract investigation, where a trustee is alleged to have breached a contract for goods or services offered.

Employment practices liability

Employment Practices Liability insurance helps deal with potential “wrongful employment practices” and claims that arise. Organisations purchase such cover to defend actions brought by employees, ex-employees, office holders and regulatory bodies who claim that there has been a breach of employment law, with subsequent loss of earnings and distress.

Pensions trustee liability insurance

Although often unpaid, trustees are expected to understand and keep up to date with the laws and investment principles of their pension schemes. Failure can result in fines or other penalties against them and the charity. Pension Trustee Liability covers defence costs, awards and damages, and therefore protection of trustees and individuals that administer a pension scheme or any employee benefit or welfare plan.

Fidelity guarantee

Fidelity Guarantee insurance helps to protect the charity against its own key officers stealing money by dishonesty or fraud. It is often a difficult insurance to sell, as few clients think this problem could ever affect them. The reality is sadly otherwise.

Hayes Parsons Insurance Brokers 

Hayes Parsons has been working with museums and heritage organisation since 1964 and can advise on your insurance arrangements as well as offer risk management advice.

If you would like to know more about protecting Trustees at museums and heritage buildings, please contact Martin Howard Cert CII, Account Executive, 0117 930 1668/07719023194 or

Hayes Parsons Insurance Brokers are the headline sponsors of AIM Conference 2022. Meet Martin at the conference and find out more about how the team can help.