Charity trustee PI vs trustee indemnity insurance

Reviewed by Matthew Bartlett, Director · Last reviewed 2026-06-23

Charities frequently confuse two related but distinct insurance covers: trustee indemnity insurance (TII) and professional indemnity insurance (PI). They protect different exposures and respond to different claim categories. This entry sets out the difference and why most well-run UK charities carry both.

Trustee indemnity insurance — protects individual trustees

TII protects individual trustees in their capacity as trustees, against personal liability arising from breach of trust, negligent management, or unauthorised acts. It responds when:

• A beneficiary alleges the trustees acted outside the charity's objects
• The Charity Commission investigates trustee conduct and seeks compensation
• A creditor alleges wrongful trading by trustees
• An employee brings a discrimination claim naming individual trustees
• Trustees authorise a payment the constitution doesn't permit and a beneficiary objects

The insured is the named trustee. The cover is for personal liability — trustees can be jointly and severally liable, so each trustee is exposed for the full amount of a claim regardless of which trustee actually acted.

Professional indemnity insurance — protects the charity as a service provider

Many charities provide professional services to beneficiaries or third parties. Examples:

• Legal advice charities (Citizens Advice, law centres, specialist legal aid bodies)
• Counselling and therapy charities
• Educational and training charities
• Financial advice / debt counselling charities
• Medical and clinical service charities
• Property management charities (social housing)

Where the charity delivers professional services, those services attract the same negligence exposures as any commercial provider. A counselling charity whose volunteer counsellor gives harmful advice faces a PI claim from the beneficiary. The charity is the named insured under PI, not the trustees.

The boundary cases

Some scenarios sit awkwardly between TII and PI:

• Trustee giving professional advice. A solicitor trustee on the board advising the charity on a matter that turns out to be wrong. Is it trustee breach (TII) or professional negligence (PI)? Usually both could respond — coordinated cover matters.
• Trustee acting as service-line manager. A trustee who is also the executive director responsible for a specific service. Mistakes in that operational role straddle TII and the charity's general liability cover.
• Volunteers giving professional services. Volunteers acting on behalf of the charity in professional capacity. The volunteers are usually covered under the charity's PI as "professional staff" — but only if specifically named in the schedule.

What most well-run UK charities carry

• Charity combined policy — bundles TII, PL, EL, contents, cyber, sometimes PI
• Or standalone TII + standalone PI + standalone PL/EL — usually with the same broker for coordination

The combined approach is usually cheaper and simpler for small to mid-sized charities. For larger charities or those with specialist service exposure, separate placements give more granular wording control.

Charity Commission position

Trustees can authorise payment from charity funds for both TII and PI (subject to the s.189 Charities Act 2011 power for TII; PI payment is uncontroversial as a normal trading expense). The trustees must be satisfied that the cover is in the charity's interests and that the policy doesn't indemnify against criminal acts or deliberate wrongdoing.

About Apex Insurance Brokers

Apex Insurance Brokers Limited places combined and standalone charity cover for UK charitable organisations. FCA firm reference number 724952. We discuss the TII/PI boundary, the appropriate cover structure for the charity's specific service mix, and the Charity Commission position before quoting.