Most organisations are aware of the need to have insurance and most are likely to have some form of insurance in place.  Often the policy is renewed each year when the invoice is received without it being adequately checked.

When was the last time your organisation undertook a formal review of your insurance policy?  Do you know exactly what it covers and furthermore is it adequate?

It is critical that you take the time to ensure you have the correct insurance in place because if there is a large successful claim made against your organisation and you did not have correct or adequate insurance, then the resources of the organisation would need to be used to pay out the claim.

Often a first reaction to this statement is that as an association or incorporated body we are protected but that is not always the case.

While the structure for the organisation creates its own legal entity it still can be sued and, furthermore, if the directors are found to have been negligent then they can become personally liable.  Irrespective of whether you are a multi-million dollar organisation or a local club with turnover of only several thousand dollars, the same principle and liability at law exists.

It is also important to realise that simply having insurance does not replace the need to have, for example, a strong risk management framework, occupational health and safety practices as well as policies and procedures that are adhered to.

The next post will discuss the main and most common types of insurance policies that you may need to consider.