Trustee indemnity insurance

Trustees worried about personal liability often reach for insurance. It helps, but not as much as people expect and not without a check first.

The charity must have power to purchase the insurance — under the governing document or the statutory power in Charities Act 2011 s.189. Policies typically exclude fines, dishonesty, and knowing breaches of trust or duty.

Insurance is not a substitute for acting within your powers: see breach of trust. And for an unincorporated charity it does not address the underlying structural exposure — incorporation does.