VvE board · reserve fund · maintenance
Avéro Achmea – directors' and officers' liability insurance
Anyone who sits on the board of a VvE (Dutch owners' association) usually does so unpaid and alongside a job. The liability that goes with it is nonetheless personal.
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Deze pagina in het Nederlands: Avéro Achmea – bestuurdersaansprakelijkheidsverzekering.
The calculator and the quote form below are in Dutch. Prefer to do this in English? Email info@finassverzekert. nl or call 072 - 509 24 56 and we will take it from there.
Work out for yourself what it would cost.
Enter your details; you will receive a proposal within one working day.
- We compare the offerings of several insurers
- An adviser checks whether the cover suits your situation
- We arrange the switch, including cancellation
A premium indication, not personal advice. Prefer to talk it through? Call 072 - 509 24 56.
In brief
Finass acts as an intermediary and compares several insurers objectively. Avéro Achmea is one of the insurers with which we place VvE covers; which party it becomes follows from what cover your association needs and not from the name on the policy schedule. Directors' and officers' liability often runs within the package that also contains the buildings insurance and the the VvE's liability insurance, but that is not a requirement.
A VvE is a legal entity (Article 5:124 of the Dutch Civil Code) and its directors are bound to perform their duties properly under Article 2:9 of the Dutch Civil Code. The complaints made are recognisable: deferred maintenance because there is no long-term maintenance plan, a reserve fund that is not at the required level while Article 5:126 DCC prescribes one, failure to insure the building or insuring it for too little, orders placed beyond the mandate in the deed of division, and decisions that were not taken in accordance with the articles and are set aside under Article 5:130 of the Dutch Civil Code.
This cover pays for the loss for which a director is held personally liable and for the costs of defence. It is not intended for damage to the building or injury to visitors: liability for a defective structure runs through Article 6:174 of the Dutch Civil Code and belongs on the VvE's liability insurance. A dispute with a supplier or an apartment owner belongs on a legal expenses insurance (rechtsbijstandverzekering) for the VvE.
This page deals with one situation. The full overview is on Directors' and officers' liability in a VvE.
What to look out for
Four points that determine, with a VvE board, whether a claim is covered.
Who is insured
Check whether, alongside the serving board members, former directors are insured as well for decisions from their period, and whether members of a technical or audit committee fall within it. A professional managing agent does not: he has his own professional indemnity insurance (BAV) for VvE management.
Maintenance, reserve fund and insurance
Most complaints concern failing to act rather than acting. Have the general meeting record decisions on the long-term maintenance plan, the annual contribution to the reserve fund and the rebuild value of the building. A minuted decision in which the meeting sets aside a piece of advice moves the responsibility away from the board.
Notification and the term of the cover
The insurance works on a claims-made basis: the moment at which the claim is notified is what counts. If you resign, arrange for claims relating to your period on the board to remain covered. A discharge granted also works only between the VvE and the board, and not towards third parties such as a supplier or an individual owner.
What is not included
Outside the cover are: intent, fraud and personal gain (Article 7:952 of the Dutch Civil Code); fines and penalty payments, for example from the local authority after an enforcement notice; the VvE's own payment obligations, such as arrears of contributions or a missed premium; injury and property damage; and circumstances already known when the policy was taken out.
What does your premium depend on?
- Number of apartment rights: the usual basis with a VvE
- Year of construction and state of the complex: deferred maintenance increases the chance of a complaint
- Whether there is a long-term maintenance plan (MJOP) — an up-to-date plan reduces the risk of dispute
- Size of the reserve fund. Article 5:126 DCC prescribes a reserve fund
- Professional or self-management: determines who carries out which tasks and must be insured
- Mixed complex: shops, business premises or many let units change the picture
Insurers weigh these details differently. That is where your saving is.
Which policy pays which claim
| Situation | Directors' and officers' liability | Liability, VvE |
|---|---|---|
| Owners hold the board personally liable because a leak has gone unrepaired for years | Yes | No |
| A visitor falls down the stairs because the handrail was loose | No | Yes |
| The legal costs of fending off a claim that ultimately proves unfounded | Yes | No |
| A former director is held liable two years after his resignation over a decision from his period | Provided that | No |
| The local authority imposes a penalty payment after an enforcement notice about the facade | No | No |
| A contractor demands payment of an invoice the association disputes | No | No |
A dispute about payment or performance belongs with legal expenses cover and not with a liability policy.
Frequently asked questions
This is what people ask us most.
We are volunteers. Can the VvE really hold us personally liable?
Yes. Serving unpaid changes nothing about the standard of proper performance of duties in Article 2:9 of the Dutch Civil Code. When it comes to it the claim often comes from a group of owners who feel that nothing has been done about maintenance for too long or that an expenditure was not permitted. Even where such a complaint ultimately does not stand up, without insurance you pay the costs of defence yourself.
We have a professional managing agent. Is this cover still needed?
Yes. The managing agent carries out tasks, but the board remains responsible for the decisions and for supervising how they are carried out. A mistake by the managing agent falls under his own professional indemnity insurance. A complaint that the board failed to check adequately or intervened too late falls outside it. Ask for the managing agent's policy schedule each year.
The board changes. Do we have to report anything?
The cover is usually arranged by office rather than by name, so a change does not always have to be reported. What matters more is that claims relating to earlier board periods remain covered and that there are no known matters that have not yet been notified. Go through the file at handover and report outstanding disputes before the new directors take office.
Can we take this out separately or only in a package?
Separately is possible too. Many VvEs place their insurance with one insurer because that simplifies management and makes the fit between the policies clearer, but it is not compulsory. We compare both routes, looking at the sum insured, the group of insured persons and the treatment of defence costs.
Read more
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