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Incorporated Societies Act 2022

Administration of societies - Indemnities or insurance for officers, members, or employees of society

97: Permitted insurance for certain liability or costs

You could also call this:

"Insurance to cover costs if you're liable as a society member or employee"

Illustration for Incorporated Societies Act 2022

You can get insurance to cover certain costs if you are an officer, member, or employee of a society. This insurance can cover you if you are liable for something, but not if it is a criminal matter, as stated in section 94. You can also get insurance to cover costs of defending or settling a claim. You can get insurance to cover costs of defending criminal proceedings if you are acquitted. The society's officers must sign a certificate saying the insurance cost is fair to the society. If the officers do not sign the certificate, or if there were no reasonable grounds for their opinion, you may have to pay the society back for the insurance cost, unless the insurance was fair to the society at the time it was taken out. You may also have to pay the society back if section 98 was not followed. However, you do not have to pay the society back if the insurance was fair to the society when it was taken out.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=LMS100982.

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96: Permitted indemnities for certain liabilities or costs, or

"When you make a mistake, your society can help protect you from costs or liability"

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98: Indemnity or insurance for breach of officers’ duties, etc, must be expressly authorised by society’s constitution, or

"Societies can help officers pay for mistakes, but only if their rules allow it."

Part 3Administration of societies
Indemnities or insurance for officers, members, or employees of society

97Permitted insurance for certain liability or costs

  1. A society may, with the prior approval of its committee, effect insurance for an officer, a member, or an employee of the society in respect of—

  2. liability (other than criminal liability) of a kind referred to in section 94; or
    1. costs incurred by the officer, member, or employee in defending or settling any claim or proceeding relating to that liability; or
      1. costs incurred by the officer, member, or employee in defending any criminal proceedings—
        1. that have been brought against the officer, member, or employee in relation to any alleged act or omission in their capacity as an officer, a member, or an employee; and
          1. in which they are acquitted.

          2. The officers of the society who vote in favour of authorising the insurance under subsection (1) must sign a certificate stating that, in their opinion, the cost of effecting the insurance is fair to the society.

          3. The officer, member, or employee who is insured is personally liable to the society for the cost of effecting insurance if—

          4. subsection (2) or section 98 has not been complied with in effecting the insurance; or
            1. reasonable grounds did not exist for the opinion set out in the certificate given under subsection (2).

              1. However, subsection (3) does not apply to the extent that the insurance was fair to the society at the time the insurance was effected.

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