It’s no secret that homelessness is a problem that isn’t going away. Shelter, one of the UK’s foremost charities for the homeless, estimates that over 320,000 people in Britain are homeless today. Shirley Greer, Charity Insurance Specialist looks at how the demands on charities makes keeping an eye on risk management even more important.
As national and local government bodies restrict funding, and rents continue to rise in the private sector, the number of people facing housing crises is growing, which in turn means that many housing charities are themselves facing considerable challenges. Hostels, homeless shelters and day support organisations such as Beacon House in Colchester, Essex, can be a lifeline for many people. They, and many other charities working with the homeless, have expanded their operations to include outreach counselling and advice services for their clients, many of whom have complex needs arising from alcohol or drug dependency, or mental health issues. But for the people like Vivienne Wiggins, who manages Beacon House, the day to day operations leave little time to deal with the myriad of legislative requirements, not least when it comes to the insurance cover they require. “There are never enough hours in the day,” says Vivienne. “Our priority is looking after the needs of our clients: giving them our time to listen to their stories, providing practical assistance in life skills such as cooking and IT, and also giving them healthcare and well-being services like foot care or a haircut. Getting good professional advice on things like insurance it then frees up our time and resources to help the people who need it most.”
Getting the right protection
“Having the correct cover for your organisation is vital,” says Shirley Greer, a Charity Insurance Specialist with Scrutton Bland. “Most charities know that they need insurance: Professional Indemnity including breach of duty, abuse cover, fundraising cover for volunteers, and cover for any retroactive abuse and historical cover are all fundamental. However it is important that charities understand other specific risks for which they may need cover. There are serious implications for a charity which does not have the correct insurance, particularly for Trustees who have the ultimate responsibility of ensuring the correct cover is in place. Having the correct Trustee Indemnity cover including full Entity cover can give Trustees and boards peace of mind and assurance that any unintentional acts are covered. A charity broker can also advise on the correct process in the event of a merger or closure of a charity.For example, should a charity cease to exist, we strongly recommend you purchase run-off cover for Trustees,Professional Indemnity and abuse. If a member of the public makes an allegation of abuse against a charity which no longer exists and the Trustees have no run-off abuse cover, they may be responsible for the legal costs.”
New threats and risks
“The risk management landscape for charities has changed considerably in the last ten years,” Shirley continues. “There are much stronger legal vetting and checking procedures for charities of all sizes, and safeguarding policies are more robust which reduces the risk of abuse. Charities and not-for-profit organisations need to remember that they are not exempt from their obligation to adhere to Health and Safety legislation. Key to complying with this is that there is formal training in place. And this is often where charities face challenges, for example: volunteers may agree to undertake something, and assumptions are made that the individual will work in a safe manner. Training for staff and volunteers should always be recorded, records retained, and accident report books reviewed. New risks have arisen in the last few years such as cybercrime, and there is worrying evidence that charities are increasingly being targeted by criminal gangs who send them fake invoices, phishing emails, and attempt to hack into their servers. Many of our clients now take out additional terrorism cover, which sounds dramatic, but is a very real consideration, especially for those charities working out of major cities.”
Internal and external threats.
Whilst Employers Liability and Public Liability continue to be the most common claims, Shirley stresses the need to consider other areas which may need insurance cover. “Unfortunately, theft by employees is more common than you’d think,” she says. “Some insurers will offer cover which protects a charity against the cost of theft by a volunteer or member of staff. We also encourage charities to consider PR crisis cover as the fallout in the media from an incident can cause serious reputational damage to a charity which then has a knock-on effect on donations. Crime insurance should also be considered as part of a cyber policy.”
The importance of working together
“There are ways in which charities can proactively manage risk, according to Shirley. “Any organisation working with vulnerable people or adults-at-risk should have policies and procedures in place and should review these on a regular basis. Training and awareness amongst staff and volunteers can be the key to successful risk management. Not only will this help to show what is and isn’t acceptable, but it can also act as an early warning signal so that staff can see and report potential incidents before they arise. There should be a high degree of awareness among staff and volunteers of safeguarding issues and their own roles within the organisation for protecting vulnerable people from harm.”