2. Types of insurance
It is theoretically possible to obtain insurance for almost any event or occurrence if there is an insurer willing to provide cover and the incorporated association is prepared to pay the premium. It can become confusing when considering all the different types of insurance products available and the assistance of a qualified adviser is advisable.
The following table sets out some of the common types of insurance products that may be relevant to incorporated associations.
| Insurance | General description |
| Public liability insurance | To cover claims brought by third parties for general legal liability; eg negligence |
| Personal and property insurance | To cover injury or damage caused to people or property |
| Directors' and officers' liability | To cover directors and officers against legal liability which may arise out of their role |
| Volunteer insurance | To cover volunteers for personal injury and public liability while carrying out work |
| Building insurance | To cover the owner of the physical premises against events such as fire, storm and vandalism |
| Legal expenses | To cover the cost of defending legal rights in relation to disputes |
| Fidelity guarantee | To cover against misappropriation of funds by employees or committee members |
| Commercial vehicles | To cover commercial vehicles for theft, fire, accident |
| Professional indemnity | To cover claims in respect of a breach of duty in the course of carrying out the organisation's usual activity or functions |
| Portable/valuable items | To cover loss of specified items |
| Goods in transit | To cover loss of or damage to goods during transit |
| Theft | To cover theft of contents, cash and stock |
| Fire and defined events | To cover loss or damage to property at premises caused by a defined insured event; eg fire, explosion, earthquake |
| Glass and signs | To cover damage to glass or signs, eg fractures and breakages |
| Events insurance | To cover an event, such as a fête, against loss (eg cancellation due to bad weather) |
| Workers' compensation | To cover injury to employees for accidents associated with work |
2.1 Compulsory insurance
Some insurance cover is compulsory under applicable laws and an incorporated association should consult a qualified adviser (such as an insurance broker or lawyer) to determine its compulsory insurance obligations. For example, it is compulsory for an incorporated association that employs staff to have workers' compensation insurance.
In addition, in some cases, a financial institution providing financial assistance to an incorporated association will insist that the association has certain minimum levels of insurance cover, such as public liability cover and professional indemnity cover.
2.2 Public liability insurance
Public liability insurance generally covers claims brought by third parties against an incorporated association in respect of personal injury or property damage that may arise out of the activities of the association. This is particularly important for associations that interact with the public (eg at premises open to the public or at public events, such as sporting activities).
2.3 Insurance for community organisations
In 2003, the Government of Western Australia established the Community Insurance Fund to assist those not-for-profit community organisations that found it difficult to afford the premiums associated with the various types of insurance set out above. The fund was closed to new members from 30 June 2007. This decision was taken "as a consequence of the general insurance market now actively seeking business and offering 'affordable' premium rates to community organisations".
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For more details on the closure of this fund, refer to the: Insurance Commission of Western Australia, 'Community Insurance Fund' |
