Trustee indemnity · Coverage
What does trustee indemnity insurance cover?
The honest list of what TII actually pays for, what it never pays for, and the contracts gap that traps trustees of unincorporated charities.
Last updated 16 May 2026·7 min read
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What TII typically covers
- Defence costs for civil claims alleging breach of trust, breach of fiduciary duty, negligence, mismanagement, wrongful act or maladministration
- Damages and compensation awarded in civil proceedings up to the policy limit
- Costs of defending regulatory investigations— Charity Commission, OSCR, CCNI, the Information Commissioner's Office (ICO), the Health and Safety Executive
- Costs of defending disqualification proceedings brought by the Insolvency Service or the Charity Commission
- Costs of defending criminal proceedings up to the point of conviction (post-conviction defence is not covered where conviction is for fraud or dishonesty)
- Defamation, libel and slander defence— often a sub-limit; Zurich's standard online product includes £100,000 libel/slander cover, others vary
- Public-relations crisis management — Markel includes The Counsel House; Ecclesiastical and Ansvar include specialist PR crisis communication
- Run-off cover for retired trustees — Ecclesiastical includes six years as standard
- Entity defence / corporate liability — only when TII is bundled with the charity entity policy (Markel, Zurich, Ecclesiastical)
Different insurers vary on the sub-limits and inclusions. The generic shape is consistent across the UK market; the detail is where products differ. Always read the policy summary, not the marketing.
What TII does not cover — the standard exclusions
Some of these exclusions are commercial choices by underwriters. Several are mandated by statute — s.189(4) Charities Act 2011 requires charity-paid TII to exclude them, and every compliant UK policy does.
- Fines imposed in criminal or regulatory proceedings (Charity Commission, ICO, HSE, Companies House, FCA)
- Liability arising from criminal proceedings where the trustee is convicted of fraud, dishonesty or wilful misconduct
- Conduct the trustee knew, or ought to have known, was not in the interests of the charity
- Deliberate or dishonest acts
- Prior known circumstancesand prior claims (the “claims-made” structure means a claim arising from circumstances you already knew about when you took out the policy will not be covered)
- Bodily injury and property damage — covered by public liability, sold as a separate policy
- Faulty professional advice given for a fee — covered by professional indemnity, sold as a separate policy
- Contractual liabilities the trustee voluntarily assumed — see the contracts gap below
- US-jurisdiction claims — most UK policies exclude
- Pension trustee liability — separate cover (Pension Trustee Liability insurance)
TII, D&O and PI — which is which
Three overlapping personal-liability covers exist in the charity / social-enterprise market. They are not interchangeable.
- Trustee Indemnity Insurance (TII): charity- and CIC-specific personal cover for trustees / directors, wrapped around the duties imposed by charity law and the Companies Act. Bought from a charity-specialist insurer.
- Directors' & Officers' (D&O) insurance: the equivalent commercial cover for company directors. A vanilla D&O policy bought from a generic broker often excludes charity-law breaches and regulatory action by the Charity Commission, making it inadequate for a charitable company.
- Professional Indemnity (PI): covers negligent advice or services delivered to a third party. Essential for advice, advocacy, training and counselling charities; covers the charity and its employees, not just trustees. Often bundled with TII by Markel, PolicyBee and Get Indemnity for small charities because the same activity generates both exposures.
For a CIC, the picture is similar but framed as “management liability” — combined D&O, employment-practices and pension-trustee cover, sometimes with charity-law extensions bolted on.
Common misconceptions
“TII covers me if I breach charity law”
Only honest breaches. TII covers a trustee accused of an honest mistake — applying the wrong rule, misjudging a conflict, making a decision that turned out to be wrong. It does not cover deliberate, dishonest or wilfully reckless conduct. The distinction matters in practice: the Captain Tom case turned on conduct the trustees knew was not in the charity's interests, which TII never covers.
“Our employers’ liability policy covers our trustees”
No. Employers' liability covers injuries to staff and volunteers caused by the charity's negligence as an employer. It does not cover claims against trustees for breach of their trustee duties. These are separate covers with different policy wordings.
“We’re too small to need it”
Partly true (claim frequency at very small scale is genuinely low) but ignores the disproportionate cost of even a baseless defence. A regulatory inquiry that lasts six months and is then dropped still costs five figures in defence work. For incorporated charities of any size, the bundled premium is small enough to make this a sensible purchase regardless of headline income.
“TII includes regulatory fines”
No. Section 189(4) Charities Act 2011 prohibits TII paid from charity funds from covering fines. ICO penalties, FCA penalties, HSE fines, Companies House late-filing penalties — all are excluded by every compliant UK policy. Defence costs up to the fine being imposed are covered; the fine itself is not.
“Trustees are protected by limited liability if the charity is a CIO or company”
Only against external claims. Trustees of an incorporated charity are still personally exposed to claims bythe charity (or by the Charity Commission on the charity's behalf) for breach of duty. Limited-liability protection runs in one direction. TII fills the other.
Frequently asked
Does TII cover former trustees?
Most charity-tailored TII policies include run-off cover — Ecclesiastical includes six years as standard; others vary from three to seven years. A claim made after a trustee retires but relating to the period of their service is generally covered, provided the policy was in force at the time of the alleged wrongful act.
Are new trustees automatically covered when they join the board?
Standard policies cover all trustees in office during the policy period without requiring notification of each trustee change. The named insured is normally the charity, with cover extending to its trustees as a class. Confirm the wording — a small number of older policies still require named-trustee schedules.
What limit of indemnity should we choose?
For most small UK charities, £250,000 to £500,000 is the standard limit and is enough for most claim profiles. £1m and £2m limits are offered by Ecclesiastical and others for larger or higher-risk charities. Above £2m the market thins out and broker-placed cover is normal. The limit applies in aggregate per policy period (not per claim) — multiple claims in one year share the limit.
Does TII cover the cost of the Charity Commission’s investigation costs ordered against trustees?
Defence costs incurred in responding to a Commission statutory inquiry are typically covered. Where the Commission orders trustees personally to repay misapplied funds (under its protective powers in the Charities Act 2011 Part 6), that order represents a finding of breach that may itself be excluded — the policy will pay the defence but not the restitution if the breach falls within the excluded categories.
Related guides
Trustee indemnity insurance — the main guide →
The full decision framework — what TII is, when it’s worth buying, and the providers worth considering.
Do I really need trustee indemnity insurance? →
The decision aid — by structure, by activity, by size.
Trustee indemnity and the Charity Commission (CC49) →
The CC49 four conditions and the s.189 statutory power.
Best trustee indemnity insurance providers →
Six UK providers compared on underwriter, sub-limits and target charity size.
How much does trustee indemnity insurance cost? →
Real specimen pricing by income band.
Unincorporated association explained →
Where the contracts gap bites hardest, and why incorporation usually solves the underlying problem better than insurance does.
Sources
- Charity Commission guidance CC49 Charities and Insurance
- Charities Act 2011 s.189 and s.189(4) (statutory power; mandatory exclusions)
- Markel, PolicyBee, Zurich, Ecclesiastical and Ansvar standard policy wordings (May 2026)
- Get Indemnity underwriting commentary on premium drivers (publicly available)
- NCVO and DSC guidance on trustee liability and insurance
- Russell-Cooke, Bates Wells, Stone King and Wrigleys trustee-liability briefings
General information, not legal or insurance advice. Policy wordings differ. For binding cover, speak to a regulated broker.