A shot in the arm for head AND heart

Ahead of our 2016 Annual Conference, details here, Rachael Romasanta reflects on a practical application of the dichotomy between heart and head.

Head or heart?  Heart or head?  Which is best?  It’s something people have grappled with for centuries, and no doubt will continue to do so.  And they will continue at ACEVO’s November conference, talking about the benefits of partnership working with ITN which perhaps creates a great argument for a bit of both.

Whilst heart has played a huge part in the growth of the charity sector since day one, it might be seen by some that “head appeal” has dominated in business.  But I detect shifting sands in the commercial world right now, surprisingly thanks to the arrival of new legislation.  It may be slight.  Or it may just be me, but “heart appeal” is winning ground in the commercial world and can be seen to be bringing together charities and the insurance industry. This month.

On 12 August the Insurance Act of 2015 finally went live.   Perhaps not in everyone’s diary, the Act is there to foster better working relationships between businesses, including charities and insurers.  It’s there to make sure that both parties know what the relevant cover entails.

What interests me though is the shift away from the current somewhat clinical, in-or-out approach to what is disclosed when setting up insurance.  In short, you (as the buyer) had to declare pretty much everything which could bring risk and if this hadn’t been specified before the cover started then getting claims paid could become difficult.

Now, under the new Act, it recognises that risk is indeed uncertain.  It is still expecting you as the insurance buyer to make every effort to reveal the realities of the risks in your charity, but it accepts that in the real world some risks arise undetected.  It recognises that you can give a very fair presentation of your risks, yet still get caught out and for that reason you should still have the benefit of cover.

It’s an admission that the head cannot do everything alone and balancing that with some heart results in a better solution than the old, binary in-or-out.   In the case of insurance it means the intent of the wording is now as good as its technical specification.

But as in all partnerships, it takes effort from both sides.  So whilst you can fully expect to benefit from the Insurance Act there is an obligation upon you to disclose what you know, or ought to know, about your charity and its activities.  You should conduct a reasonable assessment of the risks and you must open your doors to insurers’ probing questions.  Provided you do that, then the two way process has been followed and both parties are in a better place to work together.  Both parties are also likely to have more accurate expectations too, and together they have created effective, fair protection which works for both.  And that’s a good thing as far as I can see.

Rachael Romasanta, Account Manager (charity insurance), Endsleigh Insurance Brokers Ltd


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