If your Association is legally incorporated this policy could cover claims in relation to potential financial loss or compensation associated with the management of activities and the duties of your Officers and Officials.
Understanding Association Liability
This policy can cover your Association and your Directors, Committee Members and Officers for claims made against it/them jointly or individually arising from liability arising from an actual or alleged act, error, omission or breach of duty of the Association.
Officers of incorporated clubs and community groups do not always understand that in undertaking their duties they also assume personal liabilities. That is why it is so important for you as an incorporated body, to have this cover.Policy Wording: Association Liability
This is what association liability insurance can protect you from
Below are some examples of covers provided by this policy which can protect your organisation. Please refer to the policy wording or contact the LCIS team for full details about the policy’s coverage or any other additional information.
Please note, all of the covers listed below are subject to limits, sub-limits, endorsements and exclusions as described in the policy wording. Please read the full policy wording and/or the Product Disclosure Statement before making any decision about whether to obtain cover.
Legal Costs Covers your organisation’s legal costs if you are sued by a third party alleging they have suffered a loss due to an alleged act, error, omission or breach of duty by the Association or its Officers.
Employment Practices LiabilityCovers claims made against the Association or its Officers by Employees. Examples include alleged wrongful termination, discrimination or wage violations.
Fidelity Covers loss of money or property as a result of fraudulent or dishonest act committed by an Employee or Volunteer.
Statutory Liability Covers fines or pecuniary penalty imposed under a law or regulation which an Insured is liable to pay under applicable law.
Civil Liability Professional IndemnityCovers liability of the Association for damages arising from an actual or alleged act, error, omission or breach of duty; misleading or deceptive conduct; unintentional defamation; unintentional infringement of copyright, or breach of confidentiality in respect of the Associations Services.
Legislation – What You Need To Know
It is important that as an Incorporated body you understand the legislative requirements in your State because each State has its own unique statute relating to the governance of not-for-profit groups.
The obligations of your committee officials can differ from State to State, and you need to be aware of these because you and other Officers may have a statutory duty of care or be required to act with due diligence.
Also, the indemnity for Officers under the Associations Act may vary in each state.
Why Do I Need Association Liability?
Office bearers of incorporated associations have a responsibility to exercise their powers and discharge their duties at all times with reasonable care and diligence.
This means that by undertaking these duties office bearers assume potentially large personal liabilities, so it is important you have Association Liability cover in place.
Discover more about Association Liability Insurance:
Organisations can choose a policy with a $2M liability limit or a $5M liability limit.
Duty of Disclosure
Below is the Duty of Disclosure which applies to all of the LCIS policies. It is important that you disclose to us all information which we request and any information which you feel is relevant to us accepting the policy. If you are unsure, talk to the LCIS team for guidance.
In addition, you must keep us updated of any changes to your organisation prior to renewing the policy. Some of the information we require for the Association Liability policy includes (but not limited to):
- Current Number of members (not just committee members) as defined in your constitution.
- Turnover of the Association
- Objectives and Activities of the Association
- Any claims, or any incidences which may result in a claim.
Duty of Disclosure
Before you enter into an insurance contract, you have a duty of disclosure under the Insurance Contracts Act 1984. You have a duty to tell us anything that you know, or could reasonably be expected to know, may affect the insurer’s decision to insure you and on what terms. You have this duty until the insurer agrees to insure you. You have the same duty before you renew, extend, vary or reinstate an insurance contract.
If we ask you questions that are relevant to the insurer’s decision to insure you and on what terms, you must tell us anything that you know and that a reasonable person in the circumstances would include in answering the questions.
Also, we may give you a copy of anything you have previously told us and ask you to tell us if it has changed. If we do this, you must tell us about any change or tell us that there is no change. If you do not tell us about a change to something you have previously told us, you will be taken to have told us that there is no change.
You do not need to tell us anything that reduces the risk insured, is common knowledge, the insurer knows or should know as an insurer or the insurer waives your duty to tell them about.
If you do not tell us something
If you do not tell us anything you are required to, the insurer may cancel your contract or reduce the amount it will pay you if you make a claim, or both. If your failure to tell us is fraudulent, the insurer may refuse to pay a claim and treat the contract as if it never existed.
This Policy Is ’Claims Made And Notified‘
This is a type of insurance contract. This means that the policy covers you for claims which are made against you and notified to the insurer during the period of cover, irrespective of the date when the cause of action may have occurred. We strongly recommend that you implement a program to ensure that all claims are identified and notified immediately and within the policy period.
The policy should be maintained whilst the Association is in existence. If the Association ceases operation, a ‘run-off’ cover can be considered in case a claim is made in the future. Should a ‘run-off’ cover be required, please talk to the LCIS team.
A ’Claims Made And Notified‘ Policy May Not Respond To
- claims or circumstances known to you or notified to an insurer prior to inception of the policy;
- circumstances notified after expiry of the policy;
- claims notified after expiry of the policy.
Where you become aware of facts or circumstances that might give rise to a claim against you, you should notify us in writing as soon as practical, before the policy expiry date.
We will then forward the notice to the insurers on your behalf.
Delay in notifying the insurer or failure to provide all relevant facts could result in the claim being denied.
An excess is a payment you are required to make in the event of a claim, however most of our policies have low or no excess. This Association Liability policy has nil excess.
Other policies you should consider:
In our experience of working with over 10,000 community groups over the past decade, we recommend that all community organisations should consider these core insurance covers:
Public & Products Liability Insurance
Festival & Fairs Event Insurance