The Policy Behind the Project: Budgeting Insurance into Welsh Community Funding
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A grant award is often treated as the end of a funding problem. In practice, it can be the moment a different set of costs becomes visible. For many Welsh community groups, the first quote for public liability cover, building insurance or trustee indemnity arrives after the celebratory photograph has been taken and the project plan has been signed off. The result is a familiar tension: the activity is funded, but the cover required to run it is not.
Insurance is not an administrative afterthought. It is part of the infrastructure that allows a village hall, a community centre, a sports club or a charity to open its doors, welcome volunteers and hold public events. In 2026, as premiums and event costs continue to press on small budgets, Welsh groups need to treat insurance as a planned cost rather than a surprise. That means putting it into the application, not discovering it after the grant letter.
Why the premium arrives after the grant
Funders commonly ask applicants to confirm that adequate insurance is in place. Less commonly do they provide a separate budget line for it. The omission is understandable: grant programmes are often designed around activities, equipment and staffing, while insurance sits quietly in the background as a condition of good governance. But the effect on small groups can be significant. A project grant may cover a new roof, a heating system or a year of community events, yet the additional premium for insuring those activities has to come from somewhere.
The timing matters as much as the amount. Many policies are annual, while projects may run for six months or eighteen. A group that receives a short-term grant may still face a twelve-month premium, and possibly a minimum premium or arrangement fee. If the grant cannot pay for insurance, the group must either absorb the cost from reserves, reduce the activity, or seek another funder. Each option has consequences, and none is best discovered late.
The policies Welsh groups meet first
Most community organisations encounter a small cluster of insurance products. Public liability is the best known, covering claims from third parties for injury or damage arising from the group’s activities. It is often required by landlords, local authorities and funders, and it is frequently the first quote a new group obtains.
Building and contents cover matters wherever a group owns or is responsible for premises. Village halls, community centres and converted chapels may hold cover through a local authority or denominational scheme, but that arrangement should be checked rather than assumed. Trustee indemnity insurance protects trustees against certain personal liabilities arising from their role; it is not a substitute for good governance, but it can help with recruitment and retention. Event insurance covers temporary activities, from fetes and concerts to fundraising runs, and may be needed even where the group holds annual cover.
Employers’ liability may also apply where a group employs staff, and sometimes where it uses volunteers in particular ways. The detail depends on the policy and the activity, which is why generic assumptions are unwise. A group that hires a hall for a weekly coffee morning has a different risk profile from one that runs a summer festival or takes young people on trips.
Budgeting from the first draft
The practical remedy is to obtain indicative quotes before the application is submitted. A broker or sector insurance scheme can usually provide a sense of the likely premium, the excess and the conditions attached. That figure should then appear as a separate line in the project budget, described plainly as insurance. If the funder’s template does not allow a separate line, the cost can be included within an appropriate category, but it should not be left out altogether.
Groups should also consider the full policy period rather than only the project period. If a grant runs for nine months but the premium is annual, the budget should reflect the annual cost or explain how the remainder will be met. It is equally important to include the excess, since a claim may require the group to find money before the insurer responds. These are not reasons to avoid insurance; they are reasons to plan for it.
Where a funder will not pay for insurance within a project grant, the group should ask directly whether the cost can be treated as a core or operating cost. The answer may be yes even where the published guidance is silent. A short email before submission is better than an assumption after award.
Funders that may consider core costs
Several UK and Welsh funders recognise that insurance is part of running an organisation, not a peripheral extra. The National Lottery Community Fund in Wales routinely considers core costs within its community funding, and Community Foundation Wales and WCVA-administered programmes may also support organisational running costs depending on the scheme. Independent trusts such as Lloyds Bank Foundation, the Tudor Trust and Garfield Weston Foundation are known to consider core funding in certain circumstances, while the Coalfields Regeneration Trust and other place-based funders may support the practical costs of keeping community buildings open.
None of this is automatic. Each programme has its own priorities and wording, and a group should always check the current guidance and speak to the funder where possible. The point is that insurance need not be invisible. Describing it as a core cost, with a clear explanation of what it covers and why it is necessary, gives a funder a reason to consider it.
Avoiding insurance-rich, cash-poor
There is a difference between being adequately covered and being over-insured on paper while short of cash in practice. Small groups should review existing policies before buying new ones, checking for duplication and gaps. An umbrella scheme may offer better value than a standalone policy, and paying premiums monthly can help cash flow where the insurer allows it. A simple risk register can also help trustees decide which activities need additional cover and which are already included.
What groups should not do is cut cover to save money without understanding the consequence. Trustees can be personally exposed in some circumstances, and an uninsured event can undo years of community work. The safer approach is to build insurance into the funding plan, review it annually and keep a modest reserve for excesses and renewals. Insurance is not the most exciting part of a Welsh community project, but it is one of the things that makes the project possible. Budgeting for it from the start is a mark of good planning, not a sign of pessimism.
