Insurance and risk management
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New laws for Victorian incorporated associations came into effect on 26 November 2012. The resources in this section have been updated to reflect the new laws. The new Associations Incorporation Reform Act 2012 (Vic) can be accessed here, and you can read more about the changes here.
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You may be just setting up a new community organisation, or you may be about to join one, perhaps as a committee of management member, a director, an employee or a volunteer. No matter how you are involved, you need to understand the risks involved in the activities undertaken by the organisation, and your legal position should any of those risks happen to occur.
Thinking about 'risks', 'insurance' and related legal issues does not have to be a scary or negative process. All activities in life involve risk and, of course, there are some risks associated with the activities undertaken in all community organisations. If your community organisation understands these risks, there are many things that the people involved in your organisation can do to eliminate risks or minimise the chance of them occurring.
Where the potential risks can't be avoided, your community organisation can look at the insurance options that may be available to protect it.
Guide: Insurance and risk management for Victorian community organisations
The following resource Guide: Insurance and risk management for community organisations is designed to help Victorian community organisations to understand 'risk management' and legal issues relating to insurance, including:
- when your organisation should think about risk and insurance
- some of the processes and practices your community organisation can put in place to avoid or minimise the risks associated with running a community organisation
- basic information about insurance options for your organisation
- tips to consider when investigating and purchasing insurance for your organisation, and
- the circumstances in which a community organisation may be required by law or a contract to get insurance or should otherwise consider getting insurance.
Victorian Incorporated Associations - indemnity for office holders
The AIR Act introduced a new indemnity for office holders of incorporated associations. This indemnity has caused confusion and concern amongst community groups.
NOTE: Victorian Incorporated Associations
Victorian incorporated associations must 'indemnify' their office holders (including committee members). This means that they must 'indemnify' (pay back / reimburse) office holders for costs that they incur on behalf of the organisation (so long as they acted in good faith).
TIP! The indemnity of office holders is not the same as indemnity insurance.
TIP! The new Act does not introduce a legal requirement for organisations to take out insurance.
TIP! While this new law does not require your organisation to take out insurance, it is certainly worth considering insurance to cover the potential costs of the indemnity, as a part of your overall risk management strategy.
The Fact Sheet below answers frequently asked questions about the indemnity, and provides strategies for groups to manage any new risks created by the indemnity.
Legislation
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This is a link to the legislation that requires almost all employers in Victoria to take out workers compensation for their employees.
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This is a link to the legislation that requires community organisations to have motor vehicle insurance for third party injury liability. The charge for this insurance is paid for at the same time as registration renewal.
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This is a link to Commonwealth legislation that regulates most insurance contracts in Australia.
Risk management and insurance resources
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The Centre for Philanthropy and Nonprofit Studies at the Queensland University of technology has an online manual 'Developing Your Organisation' which includes a chapter on risk management for community organisations. Any references to the law may be to Queensland law and not relevant for Victoria.
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This publication outlines why it is important to manage risk and provides a simple 4-step guide to identifying and treating risks in organisations that have volunteers. It includes templates and other tools that your organisation can use as well as case studies.
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This is a page provide information on insurance for volunteers and provides links to further insurance resources.
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The 'Insurance' section of the Our Community website provides sponsored resources about insurance and risk management issues, including checklists and tools for different kinds of activities which often occur in the community sector.
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This Victorian Government website is to help people who are setting up a small business but the site has some useful information about risk management and insurance that may be relevant for a community organisation.
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VMIA provides insurance information for the nominated Community Service Organisations who receive recurrent funding for services from the Department of Human Services, the Department of Education and Early Childhood Development, the Department of Justice or the Department of Planning and Community Development.
Worksafe Victoria resources
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This is a link to the WorkSafe Victoria website. Worksafe is the Victorian government authority with responsibility for occupational health and safety laws in Victoria. The 'Safety and Prevention' and 'Publications' section of their website has resources for identifying and minimising risks in the workplace. We have included two sample resources below.
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This WorkSafe publication is written for small businesses but can be adapted for use by community organisations to assess safety in the workplace.
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This publication covers health & safety basics, managing OHS in your workplace, checklists & tools, managing accidents & claims, and resources & links for the community services sector.
Local government community insurance initiatives