Sarah Cox, managing director at Ansvar, calls for a shift in how charity insurance is perceived – from reactive claims support to proactive risk protection

Charity insurance is often misunderstood – many view it primarily as a safety net for claims rather than a vital part of managing risks proactively.

Charities, like any business, face unique risks, yet hesitation around making claims remains strong. A Gallagher report found that “1 in 10 small and medium-sized organisations say they would not survive if they had to pay up to £10,000 towards a claim that was not fully covered by insurance.” Even more concerning, the report highlights that “83% of UK properties, including those owned by charities, are underinsured.”

Sarah Cox (pictured), managing director at Ansvar, believes brokers must help charities understand their risks: “Charities potentially need even more protection because they’re being run by volunteers. That’s where broker advice and support is so important – to make sure that they’ve got that right level of protection for them.”

Emerging claims trends

The push for more protection becomes only more paramount as a host of new risks emerge. Among them is a spike in claims relating to lithium-ion batteries, which are commonly used by charities in remote or under-developed areas as off-grid power solutions, as well as for emergency and disaster relief.

Charities across the UK are increasingly adopting e-bikes and e-scooters to enhance their operations, promote sustainability, and improve accessibility. “The move towards e-bikes and e-scooters does bring with it an elevation of risk,” Cox said. “The things that we are concerned about would be just making sure those chargers are supervised, and making sure lithium-ion batteries are from reputable suppliers to try and reduce that risk.”

Cox also highlighted the need for cyber caution among charities. “They’re all communicating online, and there are duties to protect that data,” she said. “We’re not seeing claims , but I’m a bit surprised we haven’t, and I expect it might be something which we see more of going forward.”

Brokers should highlight the following emerging risks with their clients:

• Lithium-ion battery fires
• Cyber threats and data breaches
• Underinsurance due to rising costs
• Climate-related property risks
• Trustee liability exposures
• Injury risks from volunteers or service users
• Over-reliance on digital systems

Changing the insurance rhetoric to one of mitigation

According to Cox, charity insurance is as much about mitigating risk as it is about claims support. Insurers and brokers should take on a supportive role. “We are there if and when, in the worst case scenario, but we also want to be there to help manage that risk as well… it also has a direct correlation with the premium,” she said.

Brokers can further change the rhetoric by:

• Promoting prevention, positioning insurance as risk management, not just claims.
• Educating on common exposures like cyber threats, lithium batteries, and storm damage.
• Using clear, jargon-free language to explain coverage and premiums.
• Providing checklists, templates, and risk management tools.
• Supporting ongoing policy and risk reviews to prevent underinsurance.
• Showing how risk management lowers premiums and improves cover terms.
• Being a trusted advisor through events and accessible advice.
• Keeping charities informed on regulation like Martyn’s Law.

Helping clients develop a risk mitigation mindset

Cox believes brokers play a key role in making charities risk conscious. “I think it’s about signposting,” she said. “We have to be flexible in how we communicate because some charities have great sophistication, but smaller charities buying transactionally need more support.”

Brokers can also guide clients to risk management materials, surveys, and provide direct advice on buildings and valuations. Business continuity planning is also crucial to understanding and mitigating potential losses. On assisting smaller charities and not-for-profits, Cox advises brokers “engage with insurers about specific risks” and encourage use of risk management guides. For larger charities, Cox suggests that brokers can encourage businesses to develop “continuity plans” and conduct “casualty liability surveys.”

Brokers can help charities develop a risk mitigation mindset by:

• Adapting communication to charity size and needs.
• Directing charities to risk management guides.
• Promoting surveys and valuations.
• Supporting business continuity planning.
• Encouraging combined insurance and risk advice.
• Advocating with insurers on specific risks.
• Offering detailed risk support to larger charities.