Insurables — Australian business risk, sourced and dated
Cover type

Association liability insurance: what it covers and who carries it

Cover written for incorporated associations and not-for-profit boards, combining office bearer and management exposures.

Data as at · refreshed by scripts/seed-graph.mjs

In short

  • Association liability is written for incorporated associations, clubs and not-for-profit boards.
  • It combines office bearer exposures with the management and employment risks a committee carries.
  • Volunteer office bearers can be personally exposed, which is the reason the class exists.

Association liability is the not-for-profit equivalent of management liability. Incorporated associations have committees rather than boards, and members who serve without pay, but the duties attaching to those positions are real.

It is a common gap because volunteer committees rarely think of themselves as directors.

Also called: association liability, not for profit liability, office bearers liability

What the policy brings together

Office bearer liability, employment practices, statutory liability and fidelity cover are the usual sections, mirroring management liability but written for the association structure and its incorporation legislation.

Cover generally extends to the association itself as well as to the individuals on the committee.

Where volunteers stand

Incorporation limits the liability of members generally, but it does not remove the duties a committee member owes to the association. Allegations of mismanagement are made against people.

Volunteer protection legislation exists in each jurisdiction and is narrower than most committees assume, particularly where the conduct alleged is a failure of governance rather than an act during an activity.

What people get wrong about it

The first error is assuming public liability covers the committee. It covers injury and property damage, not governance allegations.

The second is assuming incorporation makes committee members untouchable.

The third is not covering employment exposures in associations that employ even one coordinator, which is where a large share of claims come from.

Questions

Our committee are all volunteers. Are they personally at risk?
Duties attach to the position rather than to whether it is paid. Volunteer protection legislation exists but is narrower than commonly assumed, particularly for governance decisions.
Is this different from public liability for our events?
Yes, and associations commonly need both. Public liability responds to injury and damage at activities; association liability responds to allegations about how the association is run.

Occupations that commonly carry it

Ordered by how central this cover is to each occupation in the graph. A pattern in the data, not a statement that any business is required to hold it.

  • Training providers — Delivery of accredited and non-accredited training to workers and businesses.
  • Childcare providers — Approved education and care of children, including family day care.

Sources