Public liability insurance for charities and not-for-profits

Why do charities need public lability insurance?

When you stack it up, there’s a lot that can go wrong when charities, clubs, and community groups get together. Or when they put on events. Not-so-wild scenarios where someone gets injured, or their property is damaged.

If it’s deemed your fault, you could be held liable for compensation. And that could see your charity’s funds draining away quicker than the contents of a kicked-over cuppa.

Neither can you assume that the venue owner’s insurance will cover the damages.

As the event organiser, it’s you who has to answer to any claims for compensation. You might also have to pay for a lawyer to defend you in court. And that can end up costing a lot (injury claims can run to many thousands of pounds, in fact).

What does public liability insurance cover charities for?

Public liability insurance is for when a member of Joe Public is injured, or their property is damaged, and they say it’s your fault. That might be in the course of the service you run, or at an event or meet-up you’ve organised.

It covers the third-party damages you’re liable for. For example, the cost of replacing some broken vintage crockery or something more expensive, like a PA system. Or, compensating someone for bodily injury, say after a basketball hoop falls on their head…

Your legal costs are paid for too if the case goes to court.

The other thing to note is that public liability covers you, your staff, and anyone else helping out for property damage – including volunteers (some of whom are bound to be clumsy). That’s valid wherever the mishap takes place.

To cover bodily injury to a helper or volunteer though, you’ll need employers’ liability insurance.

Who needs charity public liability insurance?

We’d say all not-for-profits that have dealings with the public need public liability insurance. Because you never know what might happen.

That includes small clubs, charities, community groups, after school clubs, sports clubs and all kinds of other organisations. In our experience, it’s these smaller organisations, with stretched resources, that might not conduct such thorough risk assessments…making mishaps more likely.

So, it’s just as well our public liability insurance is designed to cover charities of all shapes and sizes, working for just about every cause you can think of.

Do I need public liability insurance for a charity event?

Our advice is to have some level of public liability protection, to cover all of your events and fundraisers. Even if all you do is throw the odd coffee morning or bake sale.

Charity PL covers anyone (or anything) that’s hurt or damaged through your charity's fundraising. Whether the mishap takes place at your event or someone else’s.

But be careful if you’re organising a large event for lots of people (more than 500), where the health and safety risks are more complex. Our charity PL can’t cover events like these and you may need an additional policy.

Is public liability insurance for my not-for-profit a legal requirement?

Public liability insurance isn’t legally required, no. But we’d always recommend having it.

It protects your charity and keeps your funds flowing in the right direction – to the people or the cause you’re focused on.

It also helps look after your bank balance and your reputation.

In fact, legally, the only insurance you’re required to have is employers’ liability, which you must have if you employ people.

We’d also recommend using it to cover your volunteers – although it’s a bit of a grey area as to whether you should have it.

What other types of insurance does my charity need?

The other three types of cover we’d advise all charities to have are trustees’, employers’ liability and cyber insurance.

Trustees’ insurance offers essential security for your trustees and officers, who bear legal responsibility for your charity’s activities (and may not even realise they do). If there’s a claim of wrongdoing, they can be held personally liable – without insurance, this puts their personal finances on the line.

We’ve mentioned employers’ liability insurance already but it’s worth mentioning again. Because if you don’t have it when you should, you’re not just breaking the law. The Health and Safety Executive can fine you £2,500 for each day you operate without it.

As for cyber insurance, it’s essential if you run a website, send emails, or store people’s personal data. If your website gets hijacked, or your supporters’ data is stolen, it could spell financial and reputational trouble for your charity (read up on how cyber insurance can help charities). Best protect it with some insurance, then.

Check out our guide to all the different types of insurance charities might need.

How much does charity public liability insurance cost?

It’s hard to say exactly because all organisations are unique. It depends on what your charity, club, or community group does, how it runs its activities and how many people are involved.

Size matters where fundraisers are concerned – in that the bigger your event, the wider your scope for accidents happening. It's up to you to select your level of cover depending on what you think your risks are.

However much you pay though, it's not a lot when you consider what you could end up paying without it. Both in terms of financial and reputation costs.