The last few years have seen unprecedented change across every aspect of life, with the charity landscape being no exception. Here at WRS, our team is made up of charity insurance specialists, so we’ve caught up with Francesca Kirkham to find out what the biggest considerations for charities are in terms of their insurance over the coming years.
Francesca is our Business Development Executive, she has over 20 years of insurance experience, 15 of which have been spent at WRS specialising in the charity sector.
Insurers are experiencing rising costs, in a similar way to the general population. This in turn impacts the price of charity insurance because the cost to renew, or buy a new policy will increase. To ensure you’re getting the best cover and price for your charity, it’s vital to engage with a specialist charity insurance broker with access to major UK insurers.
Events, training, meetings and even the core services charities provide have changed dramatically over the last three years and continue to adapt even into the present day. These new activities may need more, or less, insurance cover. By staying proactive and reassessing your needs, you can maintain adequate protection.
Many charities have business interruption insurance, which covers you for loss of income or additional expenses if an insured situation was to occur and you were unable to carry out your activities as usual. Some insurers offer a standard 12-month indemnity period (which is the length of time Insurers would make payment for), however this may be insufficient in the current climate due to the increased cost of building materials and the difficulty sourcing trades people. To safeguard against extended disruptions, it is advisable to consider at least a 24-month indemnity period. However, seeking professional advice tailored to specific circumstances remains crucial for determining an appropriate limit.
The need for cyber insurance
Cyber insurance is becoming increasingly important as cyber criminals become more sophisticated. In 2022, the National Cyber Security Centre revealed that the most significant threat facing small organisations is cyber crime. Official figures revealed that there were 2.7 million cyber related frauds. Amongst the charities we speak to, there seems to be view that small charities aren’t likely to be targeted, but this is a huge misconception as they can suffer significant financial losses if targeted.
Ransomware attacks, or other cyber hacks can disrupt operations, resulting in charities being unable to carry out their work, and therefore suffering substantial income loss. Post-incident assistance from cyber security and legal specialists can be costly and potentially devastating in themselves for small charities, making it even more important for smaller charities to consider buying cyber insurance. Read our five practical steps to reduce your cyber risks here.
The need for accurate sums insured
Inflation and rising costs mean that the price to replace or repair buildings has increased, and therefore the need to make sure that sums insured are index linked in line with current inflation rates has never been more important. Index linking is a way of benchmarking the cost of assets against inflation to ensure that they are valued correctly.
We can offer charities a desktop valuation at an affordable price if you are unsure on your buildings sum insured.
While not necessarily an emerging risk, abuse cover is something that we often see missing from charity insurance policies, and a cover that we would say is imperative if your organisation works with children or vulnerable adults.
Not all policies will automatically include abuse cover as standard, so we would advise all charities who are working with these groups, to review their policies over the coming months.
As the world of charity insurance evolves, staying informed and working with knowledgeable brokers will be crucial in ensuring your charity remains suitably covered and financially protected against worst case scenarios. Consideration of risks and proactive measures will play an essential role in protecting your organisation, staff, volunteers and ultimately the individuals who benefit from your services.
WRS are specialists in charity insurance. Our experienced team are passionate about the sector. Our own directors have many years of experience as trustees, so we understand that the risks charities face can be incredibly varied and ever-evolving. For more information call the team on 01206 760780.
WRS is part of the Benefact Group, a charity-owned, international family of financial services companies that gives all available profits to charity and good causes.