The hall treasurer renews the insurance on the hall every year but never in the fifteen years they have been treasurer have the sums insured been increased. If there was a fire:
- The treasurer would be personally liable for any shortfall between the rebuilding costs and the amount the insurance company paid as they had been personally negligent
- The insurance company would understand and would probably over look the oversight and there would be no problem
- Insuring the hall is a corporate responsibility and all members have a duty to ensure that the hall is adequately protected by insurance cover
Surely no one would go with option 2! Insurance companies have no discretion to waive the rules, it would create unmanageable precedents for the future. The insurance company will pay out based on sums insured.
In too many halls insurance is seen as the treasurers domain and the treasurer is left to get on with it. However option 1 implying it is the treasurer's responsibility is totally wrong. Insuring the hall is a corporate responsibility.
The correct procedure, and best practice, is for the treasurer (or other nominated trustee for that matter) to bring the matter to the trustees attention at a committee meeting. A proposal on whether to adjust sums insured or extent of the cover, or indeed to seek alternative quotations, should be made and voted on with the appropriate actions minuted. The person authorised to do this should then report back and provide evidence that this has been done at the next meeting. If the trustees make assumptions that this has been done they are being negiligent in their duties and all would be responsible if there was a shortfall in an insurance payout.