Men's Sheds are community groups built around practical workshop activities. "Their purpose is dealing with social isolation," said Tim Larden, sales and marketing director at UK charity insurance broker Access Insurance, part of Benefact Group.
As those activities develop, groups may overlook the need to revisit their insurance. A group might buy a policy, he said, "and then put that on the shelf and think, well, that's our insurance sorted." Then a new project comes along. Larden has seen Men's Shed groups build canoes and take on hot tools, and they may not have spoken to their insurer about either.
An insurer comfortable with the hand tools a group started out with might not accept fixed machinery, hot tools or bicycle repair. Repair cafés, where volunteers help repair items people bring in, raise a similar issue: general repairs may fall within an insurer's appetite, while work on white goods brings the risk of a failed repair causing a fire.
"It's not a natural distinction to necessarily make that this activity was okay, but this activity actually is not okay with your current insurer," Larden said.
Many people arranging insurance for charities draw on their experience of buying car, home or travel cover, Larden said. That can lead them to assume that if they were not asked about something, they do not need to mention it.
Charities arranging non-consumer insurance are subject to the duty of fair presentation under the Insurance Act 2015. Brokers need to explain that responsibility, he said, so they understand that "even if it doesn't appear on a proposal form from an insurer, we should talk about everything that really is material to your organisation."
Sector knowledge also helps brokers explain unfamiliar activities to insurers. When Larden first sought cover for Men's Sheds, insurers "weren't that keen", he said. His case included the sheds' limited opening hours, perhaps a couple of sessions a week, and some insurers eventually came on board.
Charities tend to change more than an average business. While a traditional commercial renewal might focus on income, wages and employee numbers, a charity could receive a £1 million grant from a local authority or NHS trust to deliver a major project.
Some work with people with complex needs, rely on volunteers and hold sensitive data. Changes to a charity's activities can alter its insurance needs, even when those changes are less obvious than a new building or a large grant.
Open questions can reveal more than the figures alone, Larden said – what new projects a charity has, what it is proud of, how its services are changing and what pressures it is under.
"You tend to then get a little bit more of a story, and that deeper conversation benefits everybody," Larden said.
That gives the client more relevant advice and the insurer better information, while allowing the broker to look beyond processing a renewal.
Property acquisitions make the value of early discussions particularly clear. It is not uncommon for a local authority to hand a charity a building that may be borderline derelict, Larden said. It may initially be unoccupied or require renovation work, creating a need for specialist cover or risk management.
Clients are encouraged to make their broker the "first port of call and not the last line of defence", he said, but requests can still arrive the day before a charity exchanges contracts on a property.
"Giving an underwriter time to understand something and ask sensible questions and work constructively with us is a much better position than presenting an underwriter with an urgent fait accompli," Larden said.
The same principle applies to a new workshop activity or service: involving the broker while plans are taking shape gives the charity time to establish whether its insurer can accommodate the change and what protection it needs.
