What is the Indemnities Project?
Legacy income is critical to many charities' cash flow. One common cause of delay is working out how best to respond to executors who insist on an indemnity before distributing.
The Indemnities Project has been running since 2005, with over 65 charities subscribing and pooling experience. It arose out of particularly correspondence where executors were insisting, quite unreasonably, on a very wide ranging indemnity before they would comply with their obligation to distribute the estate. However, there are many instances in which an appropriate indemnity can accelerate distributions to your charity for minimal (often in practice zero) risk when the alternative (for instance arranging insurance in relation to a missing legatee) is often disproportionately expensive and time consuming.
The Indemnities Project encompasses precedent texts for letters so that charities have ready-made responses to enable them to respond constructively (but appropriately) to requests for indemnities, five different pro forma indemnities catering for different scenarios, and various advice notes.
Although we also offer informal advice as part of the project, access to these resources allows legacy or finance officers to deal with indemnities without the expense of external legal advice.
The documents are available via a password protected portal so that anybody within a subscribing charity can view and download the precedents in Word format ready to adapt to a particular matter. The documents are intended to reduce the time required internally to analyse whether what is being asked is appropriate and minimise the time charities spend in working out how best to respond.
What are the benefits of subscribing to the project?
There is often an instinctive dislike of indemnities. However, it is very often your interests to agree an appropriate indemnity so that an estate administration can be finalised. Invariably, alternative solutions, such as insurance or court approval, are more expensive and time consuming.
The precedents and advice notes give your team tools to recognise where an indemnity is in your interests whilst enabling them to require appropriate safeguards, limiting liability to what has been received as far as possible, ensuring there are obligations to notify you and safeguards against an improper calling on the indemnity.
How much does it cost to subscribe?
There is a one off joining fee and the documents are immediately available of £225 plus VAT. There is an annual subscription to cover the costs of work on additional documentation, refining existing documents and responding to queries which has not exceeded £80 plus VAT since the project started in 2006
The subscription includes informal advice and correspondence about individual indemnities you come across during the course of the year (to avoid an open ended commitment we guarantee a minimum 30 minutes without further charge – and we only charge extra by agreement in situations where for instance trustees require a formal note or we step in to deal with executors direct).
We also host a seminar at least once every two years for subscribers for which there is no additional cost.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
