POLICY: CaSE Insurance to return some profits to foundation


A City law firm has helped set up an insurance scheme tailored specifically to charities and their trustees - and taken an equity stake in the business.



Bates Wells & Braithwaite teamed up with the Charity Aid Foundation and insurance groups ABG and aQmen to launch CaSE Insurance, which offers a package of policies for charities and social enterprises. The policies are underwritten by Brit Insurance.



The venture will donate 10% of its profits to the foundation. Since the foundation itself owns 30% of CaSE Insurance, a total of 40% of the profits is to be ploughed back into the sector.



Stephen Lloyd, senior partner at Bates Wells and head of charity and social enterprise at the firm, said he worked with a specialist broker to set up the scheme with low premiums and simply worded policies. The equity partners at Bates Wells have taken a 30% stake.



He added: 'My fellow partners both in CaSE Insurance and in Bates Wells agreed absolutely that it was a sensible business strategy to return a proportion of the profits back to the charity sector.'



Ian Woodcock, the firm's business development manager, explained that because charities rarely had a great deal of capital behind them, the insurance companies treated them 'like an 18-year-old in a Ferrari who was sure to crash'.



Premiums were set accordingly high, sometimes prohibitively so, and trustees were often left personally liable for potentially ruinous sums.



The launch of CaSE Insurance coincided with changes to the Charities Act 2006 which give charities the right to purchase trustee indemnity insurance on behalf of trustees without needing specific consent from the Charity Commission.



Jonathan Rayner