> _Markdown transcription of Dual New Zealand Dual Association Liability policy wording, effective 2018-08-01. Source: https://nz.dualinsurance.com/hubfs/DUAL%20ANZ/DUAL%20New%20Zealand/NZ%20policy%20wording/DUAL-NZ-Association-Liability-Wording.pdf_ --- # DUAL New Zealand Mind the Gap Association Liability Policy Wording **Document Version:** 08.18 --- ## Section 1: Insuring Clauses ### 1.1 Cover for You We agree to pay on behalf of each **insured person** all **loss** up to the **indemnity limit** arising out of any claim first: a. made against such **insured person**, and b. reported to us during the **insurance period** in respect of any: - i. **wrongful act**; or - ii. **employment practice breach**; or - iii. **trustee breach**; for which the **association** is not permitted or required to indemnify the **insured person**. Our liability under Insuring Clause 1.1 (Cover for You) shall (in respect of each **insured person**) only apply to that part of each **loss** which exceeds the **deductible** specified in the schedule and such **deductible** shall be borne by the **insured person** at their own risk. ### 1.2 Cover for the Association We agree to pay on behalf of the **association** all **loss** up to the **indemnity limit**: #### a. Professional Indemnity on account of any **claim** first made against the **insured** and reported to us during the **insurance period** in respect of any civil liability of the **insured** arising out of the conduct of its business. #### b. Crime first discovered during the **insurance period** which results from a **dishonest act** of an **associated person** acting alone or in collusion with others, or of a **third party** committed with the intention of causing the **association** to sustain a **direct financial loss**. The total amount payable by us under Insuring Clause 1.2 (b) (Crime) for any one **direct financial loss** and for all **direct financial losses** in the aggregate during the **insurance period** inclusive of costs and expenses shall not exceed the sub-limit specified in the schedule for this Insuring Clause. This sub-limit forms part of, and is not payable in addition to, the **indemnity limit**. #### c. Association Reimbursement any **claim** first: - i. made against any **insured person**; and - ii. reported to us during the **insurance period** in respect of a **wrongful act** for which the **association** is permitted or required to indemnify the **insured person**. #### d. Association Liability in respect of any **claim** first: - i. made against the **association**; and - ii. reported to us; during the **insurance period** for a **wrongful act**. The total amount payable by us under Insuring Clause 1.2 (d) (Association Liability) for all such **loss** in the **insurance period** shall not exceed the sub-limit specified in the schedule for this Insuring Clause. This sub-limit forms part of, and is not payable in addition to, the **indemnity limit**. #### e. Employment Practices in respect of any **claim** first: - i. made against the **association**; and - ii. reported to us; during the **insurance period** for an **employment practice breach**. The total amount payable by us under Insuring Clause 1.2 (e) (Employment Practices) for all such **loss** in the **insurance period** shall not exceed the sub-limit specified in the schedule for this Insuring Clause. This sub-limit forms part of, and is not payable in addition to, the **indemnity limit**. #### f. Trustee in respect of any **claim** first: - i. made against the **association**; and - ii. reported to us; during the **insurance period** for a **trustee breach**. #### g. Taxation Investigation where during the **insurance period** the **association** has both received a **tax audit notice** and reported it to us, we will provide cover to the **association** for necessary and reasonable **tax audit costs** incurred by the **association** up to the completion of the audit or investigation. The total amount payable by us under this Insuring Clause 1.2 (g) (Taxation Investigation) in respect of all **tax audit notices** in the **insurance period** shall not exceed the sub-limit specified in the schedule. This sub-limit forms part of, and is not payable in addition to, the **indemnity limit**. Our liability under Insuring Clause 1.2 (Cover for the Association) only applies to that part of each **loss** which exceeds the **deductible** specified in the schedule and such **deductible** shall be borne by the **association** at its own risk. ### 1.3 Defence Costs in Addition We agree to pay to or on behalf of the **insured** any **defence costs** in respect of a **claim** for **loss** covered by this policy in addition to the **indemnity limit**, in an amount not exceeding the same **indemnity limit**. We will only pay **defence costs** however if: a. we incur them; or b. the **insured** incurs them after obtaining our agreement in writing and the **defence costs** are in our view reasonable and necessary. We will not defend or continue to defend any **claim** to which the policy would provide indemnity, or pay or continue to pay any **defence costs** associated with such defence, once the **defence costs indemnity limit** has been exhausted. ### 1.4 Advancement of Defence Costs We agree to pay for **defence costs** in respect of any **claim** covered under this policy as and when they are incurred prior to final resolution of the **claim**, and within 30 days of receipt by us of sufficiently detailed invoices for those costs. The maximum amount of **defence costs** and other costs and expenses we will advance is the amount of any applicable sub-limit or the **indemnity limit**. Upon exhaustion of the applicable sub-limit or the **indemnity limit** our obligation to advance **defence costs** will cease. However any **defence costs** that are paid will be repayable to us by the **insured** in the event and to the extent that it is determined under the policy that the **insured** was not entitled to the payment of the **defence costs**. ### 1.5 Retroactive Date This policy shall only provide cover in respect of **wrongful act**, **employment practice breach**, **trustee breach**, **tax audit notice** or **dishonest act** arising from an act, error or omission of the **insured** committed or allegedly committed after the **retroactive date**. --- ## Section 2: Automatic Coverage Clauses Each Automatic Coverage Clause is automatically included under the policy unless specifically stated otherwise in the schedule. Automatic Coverage Clauses are subject to the Insuring Clauses and all other policy terms, conditions and exclusions, definitions and the DUAL New Zealand Mind The Gap General Conditions & Exclusions Section. The sub-limits applicable to these Automatic Coverage Clauses form part of and are not in addition to the **indemnity limit**. ### 2.1 Automatic Reinstatement for Insured Persons In the event of a reduction (in whole or in part) of the **indemnity limit** for **insured persons** as a result of payment by us of **loss** under Insuring Clauses 1.1 and/or 1.2, we will reinstate the **indemnity limit** by the amount of such reduction on the following basis: a. the total amount payable by us under this policy shall not exceed twice the **indemnity limit**; and b. the cover under this Automatic Coverage Clause will only be available for **insured persons** for any subsequent **loss** in relation to any **claim**(s) based on facts and matters that are entirely different from and unrelated to those upon which the **claim**(s) is (or are) based and which led or contributed to the reduction referred to above. This additional benefit does not provide additional coverage in respect of the **claim**(s) that led or contributed to the reduction; and c. the maximum amount of **loss** payable by us for all **insured persons** under this Automatic Coverage Clause in respect of any number of **claim**(s) which arise out of or are attributable to or are in any way connected with a single **wrongful act**, or **employment practice breach** inclusive of all **loss** is the **indemnity limit**; and d. if the **association** or **insured persons** has or have in effect, or the benefit of, any policy or policies providing coverage in excess of this policy or any other policy, then the additional coverage provided by this clause will only take effect after the total exhaustion of any amounts payable under any such other policies but before any similar reinstatement provisions as may be contained in any such other policies take effect; and e. this provision shall only be available to you to the extent that you are an **insured person**. This clause does not apply in respect of any Automatic Coverage purchased. ### 2.2 Committees We agree to provide cover for any **claim** against any member of any **committee** established by the **association**, in respect of the conduct of the business or activities of such **committee**. ### 2.3 Continuous Cover Notwithstanding General Exclusion 6.13 (Prior Knowledge) (a) and (b), we agree to provide cover in respect of any **claim** made in the **insurance period** where the **insured**: a. first became aware, prior to the **insurance period**, that a **claim** might or could arise from facts or circumstances known to it; and b. had not notified us of such facts or circumstances prior to the **insurance period**. Provided that: i. we were the insurer of the **insured** when the **insured** first became aware of such facts and circumstances; and ii. we have continued, without interruption, to be the **insured**'s insurer up until this policy came into effect; and iii. there has not been any fraudulent non-disclosure or fraudulent misrepresentation by the **insured** in respect of such facts or circumstances; and iv. we have the discretion to apply either the terms of the policy on foot when the **insured** first became aware of the facts and circumstances, including but not limited to the **indemnity limit** and **deductible**, or the terms of this policy; and v. the **insured** agrees to only make a **claim** under one policy issued by us. For the purpose of this Automatic Coverage Clause only, the definition of we/us/our in Definition 5.63 also includes the Underwriter(s) for which we were the agent on any previous policy issued by us. Subject to the terms of this Automatic Coverage Clause and the terms of the policy, the intention of this Automatic Coverage Clause is to provide continuous cover to the **insured** notwithstanding any change in the identity of the Underwriters for which we presently act, or have previously acted, as agent. ### 2.4 Contractual Penalties We agree to pay on behalf of the **insured** any penalty for which the **insured** is liable under a written contract resulting directly from **direct financial loss** covered by this policy. The maximum amount payable under this Automatic Coverage Clause during the **insurance period** is the sub-limit specified in the schedule. ### 2.5 Crime Investigation Fees Under Insuring Clause 1.2 (b) Crime and subject to Clause 4.8 Notification of Direct Financial Loss, we will pay the reasonable and necessary fees, costs and expenses of a fraud investigator nominated by the **Association** and approved in writing by us to establish the amount of any **direct financial loss** notified to us and covered by the policy, in excess of the **deductible** applicable for Insuring Clause 1.2 (b) Crime. The investigation fees do not include expenses incurred by the **association**. The fraud investigator shall: a. Investigate the facts behind such **direct financial loss**; and b. Determine the quantum of such **direct financial loss**, and c. Advise when and how the **association**'s controls were or may have been breached; and d. Provide recommendations which may prevent future similar **direct financial loss**; and e. Issue their findings in a report format approved by us; and f. Provide a copy of the report to the **association** and to us. We will pay for the reasonable and necessary fees, costs and expenses of the fraud investigator provided the **direct financial loss** is ultimately determined to be covered under this policy. The sub-limit for this Automatic Coverage Clause is specified in the schedule and in addition to the sub-limit applicable for Insuring Clause 1.2 (b) Crime displayed in the schedule. ### 2.6 Crisis Containment We shall reimburse the **association** for **crisis loss** in excess of the **deductible** which the **association** incurs by reason of a **crisis event** which first occurs and is notified to us during the **insurance period**. ### 2.7 Defamation We agree to pay to or on behalf of the **insured** all **loss** resulting from any **claim** against the **insured** arising out of the **insured** making an unintentional defamatory statement in the conduct of its business. ### 2.8 Discovery Period The **insured** gives written notice to us during the **discovery periods** as specified in (a) to (c) below of any **claim** first made in respect of a **wrongful act** or **dishonest act** occurring prior to the end of the **insurance period**: If written notice is given to us: a. within 30 days of the end of the **insurance period**, then we will grant cover automatically with no additional premium payable; or b. within 12 months of the end of the **insurance period**, then we will grant cover if the **insured** requests such period in writing within 15 days after the end of the **insurance period** and tenders an additional premium of 100% of the annual premium level within 30 days of the end of the **insurance period**; or c. within 84 months of the end of the **insurance period**, then we will grant cover if a **transaction** takes place and the **insured** requests such period in writing within 30 days following the end of the **insurance period**, on such terms and conditions, if any, and for such additional premium as we may reasonably decide. This Automatic Coverage Clause is not available if this policy is: a. renewed or replaced with any other Association Liability policy; or b. cancelled or avoided. Any **discovery period** purchased under this Automatic Coverage Clause is non-cancellable, and the premium paid for the **discovery period** is non-refundable. ### 2.9 Disposal of Subsidiary We agree to pay to or on behalf of the **insured** **direct financial loss** sustained by any **subsidiary** sold, otherwise disposed of or liquidated during the **insurance period** and which was previously insured by us under this policy if the **direct financial loss**: a. is discovered after the date of sale, disposal or liquidation and before the expiry of this policy; and b. was caused by a **dishonest act** committed before the date of sale, disposal or liquidation. Any part of such **direct financial loss** that was caused by a **dishonest act** committed after the date of sale, disposal or liquidation is not covered by this Automatic Coverage Clause. ### 2.10 Emergency Defence Costs Notwithstanding any provision in the policy to the contrary, if it is not possible for the **insured** to obtain our written consent prior to incurring **defence costs**, we will waive prior consent provided that our consent is obtained within 30 days of the first of such **defence costs** being incurred. If we subsequently determine that there is no entitlement under the policy for any **defence costs** that we have paid under this clause, the **insured** must repay those amounts to us immediately. A separate **deductible** will apply under this Automatic Coverage Clause, as specified in the schedule. The **deductible** is inclusive of **defence costs**, unless otherwise specified in the schedule. ### 2.11 Employee Plans We agree to pay on behalf of the **association** **direct financial loss** covered by this policy which is sustained by an **employee plan**. Any amount payable by us under this Automatic Coverage Clause shall be paid solely for the benefit of the **employee plan** which has sustained the **direct financial loss** and the **association** shall not be entitled to any payment in respect of the **direct financial loss**. For the purposes of this Automatic Coverage Clause only, **employee** includes an **employee** of an **employment plan** and an **employment plan** shall be deemed to be an **insured**. ### 2.12 Extortion We agree to pay to or on behalf of the **insured** **direct financial loss** covered by this policy caused by **money** or **securities** being paid or surrendered by an **associated person** from the premises as the direct result of **extortion** provided that before such payment or surrender occurs the person who is the victim of the **extortion** has made reasonable effort to inform the **association** of the **extortion** and the **association** has reported the **extortion** to the police. ### 2.13 Fair Trading Act We agree to pay to or on behalf of the **insured** all **loss** resulting from any **claim** for compensation made against the **insured** alleging breach of any of sections 9-14 of the Fair Trading Act 1986. ### 2.14 Former Subsidiary Cover We agree to provide cover in respect of any **association** that ceases to be a **subsidiary** during the **insurance period** or prior to commencement of the **insurance period**, provided that the cover provided shall only apply in respect of a **wrongful act**, **employment practice breach**, **trustee breach** or **dishonest act** that occurred whilst the entity was a **subsidiary** of the **association**. ### 2.15 Heirs, Estates and Legal Representatives We agree to provide cover to the estate, heirs, legal representatives or assigns of any deceased or mentally incompetent, bankrupt or insolvent **insured person** in respect of **loss** arising from a **wrongful act**, **employment practice breach** or **trustee breach** committed by an **insured person** that is covered under this policy. It is a condition of this Automatic Coverage Clause that any estate, heirs, legal representatives or assigns will observe and be subject to all applicable provisions of this policy. ### 2.16 Insured v Insured Defence Costs Notwithstanding Exclusion 3.6 (Insured v Insured) of the policy, we agree to pay **defence costs** in respect of: a. any **claim** brought or maintained by the **association** for contribution or indemnity, if the **claim** directly results from another **claim** otherwise covered under the policy; b. any **claim** brought or maintained on behalf of the **association** or any **outside entity** by any external administrator to the **association** or any **outside entity** (including but not limited to a liquidator, receiver, administrator or other external administrator) where such external administrator is appointed by a Court and such **claim** is brought without the solicitation, assistance or co-operation of any **insured person** or director, **officer**, **trustee**, governor or equivalent position in any **outside entity**, except when such solicitation, assistance or cooperation is required by law; c. any shareholder derivative action brought or maintained on behalf of the **association** or any **outside entity** without the solicitation, assistance or co-operation of an **insured person** or director, **officer**, **trustee**, governor or equivalent position in any **outside entity**, except when such solicitation, assistance or co-operation is required by law; or d. any **claim** instigated by any regulatory authority on behalf of the **association** or any **outside entity** without the solicitation, assistance or co-operation of an **insured person** or director, **officer**, **trustee**, governor or equivalent position in any **outside entity**, except when such solicitation, assistance or co-operation is required by law. ### 2.17 Interest Receivable or Payable We agree to pay to or on behalf of the **association** any interest actually lost or paid by the **association** directly in respect of **direct financial loss** covered by this policy provided that our liability under this Automatic Coverage Clause shall be calculated by applying the average of the Reserve Bank of New Zealand base rate in force between the time that the **direct financial loss** is sustained and the date of discovery of the loss. The maximum amount payable under this Automatic Coverage Clause during the **insurance period** is 10% of the **indemnity limit**. ### 2.18 Internet Liability Notwithstanding Exclusion 3.3 (Defamation, Breach of Privacy and Intellectual Property), we agree to provide cover in respect of any **claim** for an **internet error** committed or alleged to have been committed by the **insured** via its internet site, use of the internet, electronic mail or any electronic network. We will not cover the **insured**, including for **defence costs** or **loss**, in respect of any **claim** arising from or directly or indirectly caused by, or in any way connected with: a. chat rooms, electronic bulletin boards or electronic open forum debates; or b. indecent, obscene, pornographic, adult or objectionable material of any kind or any matter prohibited by any law, rule or regulation. The sub-limit of liability for all such payments under this Automatic Coverage Clause is the amount specified in the schedule. This sub-limit forms part of, and is not payable in addition to, the **indemnity limit**. ### 2.19 Loss of Data We agree to pay to or on behalf of the **insured** any costs and expenses incurred by the **insured** in replacing or restoring **lost data** for which the **insured** is legally responsible if: a. the loss of the **data** is first discovered during the **insurance period**; and b. the **insured** first notifies us within 30 days of discovery of the loss of the **data**; and c. the **insured** provides us with bills and accounts substantiating the costs and expenses incurred by the **insured** in replacing or restoring the **lost data**; and d. we approve or a competent person nominated by us approves the bills and accounts. The maximum amount payable under this Automatic Coverage Clause is the sub-limit specified in the schedule during the **insurance period** which is part of and not in addition to the **indemnity limit**. A separate **deductible** is applicable under this Automatic Coverage Clause as specified in the schedule. The **deductible** is inclusive of **defence costs**, unless otherwise specified in the schedule. ### 2.20 New Subsidiary We agree to provide cover in respect of any **subsidiary** which is created or acquired by the **association** during the **insurance period**, provided that the **subsidiary**: a. has total gross assets which are less than 20% of the total gross assets of the **association**; and b. has gross annual turnover of less than 20% of the total gross annual turnover of the **association**; and c. has total gross assets which are less than 10% of the total gross assets of the **association** in the USA or Canada. The cover provided shall only apply in respect of a **wrongful act**, **employment practice breach**, **trustee breach** or **dishonest act** occurring after the date of creation or acquisition. ### 2.21 Occupational Health and Safety Notwithstanding Exclusion 3.2 (Bodily Injury / Property Damage), we agree to pay **defence costs** in respect of any **claim** that is both first made against an **insured** and first reported to us during the **insurance period** where such **claim** arises from a breach or alleged breach of the Health and Safety at Work Act 2015 (or any amendment or re-enactment thereof), or any other New Zealand or Australian legislation governing workplace conditions and procedures. This Automatic Coverage Clause will not apply if the **insured** has cover under a Statutory Liability Policy. ### 2.22 Official Investigations and Inquiries #### a. Cover for You We agree to pay **defence costs** incurred with our prior written consent for any attendance by an **insured person** for examination at any official investigation, examination or inquiry in relation to the affairs of the **association** or any other examination of the **insured person** by virtue of his/her position as a director of the **association** where such investigation, examination or inquiry may lead to a recommendation in respect of civil liability or civil proceedings which would be a **claim** covered under this policy. Notice of the official investigation, examination or inquiry must be both first received by the **insured person** and notified to us during the **insurance period**. #### b. Cover for the Association We agree to pay **defence costs** incurred with our prior written consent for any attendance by the **association** at any official investigation, examination or inquiry in relation to an allegation that the **association** has breached workplace health and safety laws or regulations or employment laws or regulations, where the attendance at the investigation, examination or inquiry may lead to a recommendation in respect of civil liability or civil proceedings which would be a **claim** covered under this policy. Notice of the official investigation, examination or inquiry must be first received by the **association** and notified to us during the **insurance period**. ### 2.23 Order of Payment If the payment of **loss** in respect of a **claim** is due under this policy but the amount of such **loss** in the aggregate exceeds the remaining available **indemnity limit**, we shall: a. first pay such **loss** for which coverage is provided under Insuring Clause 1.1 (Cover for You) of this policy; then b. to the extent of any remaining amount of the **indemnity limit** available after payment under (a) above, pay such **loss** for which cover is provided under any other provision of this policy. ### 2.24 Outside Directorship Cover We agree to pay on behalf of the **insured** all **loss** arising out of any **claim** both first made against any **insured person** and first notified to us during the indemnity period, who was, is or may become, at the written request of the **association**, a director, **officer**, **trustee**, governor or equivalent position in any **outside entity** for any **wrongful act**, **employment practice breach** or **trustee breach** in such **insured person**'s capacity as a director, **officer**, **trustee**, governor or equivalent position in the **outside entity**. This cover shall: a. only apply in excess of any insurance in respect of the **outside entity** as well as any indemnification provided by the **outside entity**, and; b. not apply in connection with any **claim** made against any **insured person** by any shareholder of the **outside entity** holding 20% or more of the issued and outstanding voting share capital of the **outside entity**, and; c. not apply in respect of any **claim** arising out of, based upon, attributable to or in any way whatsoever connected with the actual or alleged insolvency of any **outside entity**. ### 2.25 Panel Counsel The **insured** is entitled to one (1) hour free advice from any one firm listed on our panel of solicitors relating to a matter which we have accepted as notification of circumstances which may give rise to a **claim** under this policy. We consent to that firm listed on our panel of solicitors being retained to act for an **insured** in respect of any **claim** covered by this policy. ### 2.26 Physical Loss or Destruction of or Damage to Money or Securities We agree to reimburse the **association** for any physical loss or destruction of or damage to **money** or **securities** during the indemnity period caused by a **dishonest act** provided that such physical loss, destruction or damage occurs: a. within the **premises**; or b. inside any banking premises or similar recognised place of safe deposit; or c. whilst in transit and in the care, custody and control of the **association** or any security **association** or armoured motor vehicle **association** which is duly authorised by the **association** to have the care, custody or control of such **money** or **securities**. The amount payable under this Automatic Coverage Clause is limited to the excess of any valid and collectible indemnity, contractual or otherwise, available to the **association**, or which would be valid and collectible except for the application of an excess or the exhaustion of a policy limit. ### 2.27 Pollution Defence Costs Notwithstanding Exclusion 3.10 (Pollution), we agree to pay **defence costs** in relation to claims that are covered under this policy arising from or connected with the actual, alleged or threatened discharge of **pollutants** up to the sub-limit specified in the schedule. This sub-limit forms part of, and is not payable in addition to, the **defence costs indemnity limit**. ### 2.28 Public Relations Cover We agree to pay on behalf of the **insured** any **public relations expenses** incurred by the **insured**: a. in connection with an incident in order to prevent or minimise the risk of a **claim** which would be covered under the policy, or in connection with an incident that results in a **claim** covered under the policy. Provided that: i. the **insured**'s entitlement to this cover is conditional upon the **insured** providing us with full written details of the incident no later than 30 days after the **insured** first becomes aware of the incident; ii. the incident must occur and be reported during the **insurance period**; iii. the incident must occur in New Zealand; and iv. the maximum amount payable under this Insuring Clause is the sub-limit specified in the schedule during the **insurance period** which is part of and not in addition to the **indemnity limit**. A separate **deductible** will apply to each incident under this Insuring Clause, as specified in the schedule. b. in connection with a **claim** that is covered under this policy for extradition of such **insured**; or c. to mitigate any adverse effect on such **insured**'s reputation by disseminating findings which exonerate the **insured person** from fault, liability or culpability in connection with a **claim** that is covered under this policy, provided such findings are made by a court with jurisdiction to finally dispose of such **claim** (including the outcome of any appeal in relation to such **claim**). Our liability under this Automatic Coverage Clause shall only apply to that part of each incident which is in excess of the **deductible** specified in the schedule. The total amount payable by us under this Insuring Clause in respect of all insureds for all **public relations expenses** shall not exceed the sub-limit specified in the schedule. This sub-limit forms part of the **indemnity limit**, and is not payable in addition to that **indemnity limit**. ### 2.29 Retirement Cover If the **association** does not renew this policy or replace it with any other insurance providing Association Liability coverage, and a **discovery period** is not purchased by the **insured** under Automatic Coverage Clause 2.8 (Discovery Period) of this policy, then any **insured person** will be automatically entitled to an 84 month **discovery period** at no additional premium after the expiry of the **insurance period** provided that the **insured person** retired from all employment or office prior to the expiry of the **insurance period**. ### 2.30 Software Reconstitution Costs We agree to pay on behalf of the **association** any reasonable and necessary costs incurred, with our prior consent, for re-writing or correcting or amending the **association**'s software programmes which have been damaged or modified in consequence of a **dishonest act** covered by this policy. For the avoidance of doubt this Automatic Coverage Clause does not provide indemnity in respect of the costs of rectifying or amending errors or deficiencies in such software programmes that existed prior to the acts giving rise to the loss. The maximum amount payable under this Automatic Coverage Clause is the sub-limit specified in the schedule during the **insurance period** which is part of and not in addition to the **indemnity limit**. --- ## Section 3: Exclusions We will not cover the **insured** for or in connection with: ### 3.1 Assumed Liability Any **claim** arising from or directly or indirectly attributable to or in consequence of any duty or obligation assumed by an **insured** by way of warranty, guarantee, indemnity, contract or agreement, unless the **insured** would have incurred the liability in the absence of such warranty, guarantee, indemnity, contract or agreement. ### 3.2 Bodily Injury / Property Damage Any **claim** for bodily injury, sickness, mental anguish or emotional distress or disturbance, disease or death of any person howsoever caused or damage to or destruction of any tangible property, including loss of use thereof. However, this exclusion shall not apply to any **claim** in respect of mental anguish or emotional distress or disturbance as a result of an **employment practice breach**. ### 3.3 Defamation, Breach of Privacy and Intellectual Property Any **claim** or incident arising from or attributable to libel, slander or defamation of character, injurious or malicious falsehood, invasion of privacy, breach of confidence or confidentiality, unlawful interference with a contract, intimidation, interference with trade by unlawful means, conspiracy to cause damage whether by lawful or unlawful means, infringement of copyright or design right whether registered or unregistered, infringement of patent, infringement of trademark, passing-off or any other infringement of intellectual property right or plagiarism or groundless threats of infringement proceedings. ### 3.4 Excluded Activities Any **claim** or investigation arising from or directly or indirectly attributable to or in consequence of: a. finance and/or mortgage broking; or b. provision of legal advice or legal services; or c. corporate advisory services, including but not limited to advice or consulting in connection with mergers and acquisitions of entities or businesses or parts thereof; or d. stockbroking, financial planning, insurance-related or funds management activities; or e. actual or alleged advice in relation to finance, accounting or tax matters; or f. provision of medical advice or medical services; g. any valuation of property or premises made by or on behalf of the **insured**; or h. any errors in an estimate of probable construction cost or cost estimate; or i. any construction, assembly, installation, erection or maintenance undertaken by or on behalf of the **insured**; or j. any breach of any express or implied warranty arising out of the development of any property; or k. any loss or damage which would normally be the responsibility of a contractor; or l. any loss of or damage to, including loss of use of or value in, any goods in the care, custody or control of the **insured**; or m. any act, error or omission in the conduct of any activity not part of the **insured**'s business. ### 3.5 Insolvency Any **claim** or incident arising from or in any way connected with the insolvency, liquidation, bankruptcy, receivership or administration of the **association** or any **subsidiary** or any **outside entity** or its actual or alleged inability to meet any or all of its debts as and when they fall due. ### 3.6 Insured v Insured Any **claim** which is brought by or on behalf of the **association** or any **outside entity** provided, however, that this exclusion shall not apply to: a. any **claim** brought or maintained by the **association** for contribution or indemnity, if the **claim** directly results from another **claim** otherwise covered under the policy; b. any **claim** brought or maintained on behalf of the **association** or any **outside entity** by any external administrator to the **association** or any **outside entity** (including but not limited to a liquidator, receiver, administrator or other external administrator) where such external administrator is appointed by a Court and such **claim** is brought without the solicitation, assistance or co-operation of any **insured person** or director, **officer**, **trustee**, governor or equivalent position in any **outside entity**, except when such solicitation, assistance or cooperation is required by law; c. any shareholder derivative action brought or maintained on behalf of the **association** or any **outside entity** without the solicitation, assistance or co-operation of an **insured person** or director, **officer**, **trustee**, governor or equivalent position in any **outside entity**, except when such solicitation, assistance or co-operation is required by law; or d. any **claim** instigated by any regulatory authority on behalf of the **association** or any **outside entity** without the solicitation, assistance or co-operation of an **insured person** or director, **officer**, **trustee**, governor or equivalent position in any **outside entity**, except when such solicitation, assistance or co-operation is required by law. ### 3.7 Investment Performance Any **claim** or liability directly or indirectly arising from attributable to or in consequence of: a. Any actual or alleged dealings of any nature by which it is sought to affect the price of, or market in, any shares or debentures of any **association** or commodity or currency, or of any negotiable instrument, other than dealings carried out in accordance with the laws, rules and regulations applicable to such dealings; or b. Any **claim** arising from any financial or investment advice provided by any **insured**, including but not limited to any advice or recommendation as to the valuation, tax implications or performance of any investment; or c. A failure by the **insured** to warn of the risks of market fluctuation of any investment. ### 3.8 Liability as Occupier, Motor, Marine Any **claim** or liability arising from or incurred or alleged to have been incurred: a. in connection with the use, occupation, ownership or lease of any real estate or personal property, by or on behalf of the **insured**; or b. as an owner or operator of any aircraft, marine, craft or motor vehicles of any kind. ### 3.9 Major Shareholder Any **claim** brought by any shareholder owning, directly or indirectly, at least 15% of the voting share capital of the **association** or any of its **subsidiaries** or any **associated association** and/or by any shareholder that has or had any Board representation on the **association** or any of its **subsidiaries** or any **associated association**. ### 3.10 Pollution Any **claim** or incident arising from or in any way connected with: a. the actual, alleged or threatened discharge, dispersal, release, seepage or escape of **pollutants** into or upon land, building or other property, the atmosphere or any water course or body of water, whether such discharge, dispersal, release, seepage or escape is intentional or accidental; or b. any direction or request to test for, monitor, clean up, remove, contain, treat, detoxify or neutralise **pollutants**. This Exclusion shall not apply to claims made by a shareholder of the **association** either directly or derivatively alleging damage to the **association** or its shareholders, but subject always to Exclusion 3.9 (Major Shareholder). ### 3.11 Product Liability Any **claim** or liability arising from or in connection with the manufacture, preparation, modification, repair, supply, maintenance or treatment of any goods or products sold, supplied or distributed by the **insured**. ### 3.12 Prospectus Liability Any **claim** made against any **insured** arising out of or in any way connected with: a. any **disclosure document** which contains an offer for the issue, sale, purchase or transfer of **securities**; or b. the making of any written or verbal representations in connection with a **disclosure document** or any offer referred to in (a). ### 3.13 Superannuation Liabilities Any **claim**: a. arising out of or in any way connected with the failure of the **association** to pay into, or collect contributions for, a **fund** as required by law and/or a **fund** trust deed; or b. for or in respect of **benefits**. ### 3.14 Territory Any **claim** or liability arising from or directly or indirectly attributable to or in consequence of any act, error or omission that occurred outside the countries specified in the schedule. ### 3.15 Trading Debt any **claim** arising from or directly or indirectly attributable to any trading debt or business liability of the **insured** or any guarantee given by any **insured** for a debt. ### 3.16 Wilful Conduct Any **claim** or incident arising from or in any way connected with any **insured**: a. gaining any personal profit or advantage to which the **insured** was not legally entitled; b. having improperly benefited from any securities transaction as a result of information that is/was not available to other sellers or purchasers of such **securities**; or c. committing any wilful violation or wilful breach of any Act of Parliament. For the purpose of determining the applicability of this exclusion, the conduct and knowledge of any **insured** shall not be imputed to any other **insured**. This exclusion shall only apply if it is established through a judgment or any other final adjudication adverse to the **insured**, or any admission by an **insured**, that the relevant conduct did in fact occur. --- ## Exclusions Applying Only To Insuring Clause 1.2 (b) (Crime) The following Exclusions apply with respect to Insuring Clause 1.2 (b) (Crime) and any relevant Automatic Coverage Clause. ### 3.17 We will not cover the association in connection with any: #### Consequential Loss a. Indirect or consequential **loss** of any nature, including but not limited to any loss of income, profits, or dividends not realised by the **insured** or any other individual or organisation, business interruption costs or denial of service including but not limited to computer time, access or use, wear and/or tear, gradual deterioration or damage from moth or vermin or mechanical or electronic equipment damage, breakdown or failure or other property damage. #### Credit Risks b. **Loss** resulting from any of the following acts or omissions by **third parties** not acting in collusion with an **associated person**: i. default under a **credit arrangement**; and / or ii. fraudulent alteration or forgery of documents in connection with a **credit arrangement**. #### Dual Controls c. **Loss** connected with the issuing and drawing of cheques, account withdrawals or funds transfers sustained by the **association** by reason of the absence of or failure to have a clear segregation of duties and procedures in connection with the issuing and drawing of cheques, account withdrawals or fund transfers in excess of $1,000 in value. Such cheques, account transactions or fund transfers must be counter signed or authorised by another authorised officer who must, independently of the **employee** drawing the cheque, making account withdrawals or fund transfers, examine the supporting vouchers or requisitions or verify against an authorised payment list prepared and checked independently of the drawer of the cheque, or person making the account withdrawals or fund transfers. #### Fees, Costs or Expenses d. Fees, costs or expenses incurred by the **association** in establishing the existence or amount of any **loss** covered by this policy or in prosecuting or defending any legal proceeding or for any recall costs or costs associated with a recall. e. **Loss** caused by fire except as expressly provided in Automatic Coverage Clause 2.26 (Physical Loss or Destruction of or Damage to Money or Securities). #### Intellectual Property and Confidential Information f. **Loss** that is in any way connected with infringement or plagiarism of any copyright, trademark, registered design or patent, breach of any intellectual property right or breach of confidence, or any allegation of such conduct. #### Inventory Computation Losses g. **Loss** of which there is no proof or supporting documentation to prove a covered **loss** other than an inventory or profit and loss computation provided that where the **association** has proven to our satisfaction that an identifiable **associated person** has caused the **loss**, an inventory or profit and loss computation may be submitted as partial evidence in support of proof of a covered **loss** as required by Condition 4.8 (Notification of Direct Financial Loss). #### Liabilities to Third Parties h. Fines, penalties and liabilities to any persons other than as expressly provided for in the definition of **direct financial loss** or Automatic Coverage Clause 2.4 (Contractual Penalties). #### Loss Sustained After Knowledge i. **Loss** sustained after the discovery of any part of that **loss**. #### Non-Violent Crime j. **Loss** in respect of other property in the **premises** unless resulting from theft or attempted theft by a **third party** following the **third party**'s entry to or exit from the **premises** by violent or forcible means or resulting from the **dishonest acts** of an **associated person**. #### Premises Damage k. **Loss** in respect of damage or destruction to any of the **premises**, howsoever caused. #### Prior or Subsequent Discovery of Loss l. **Loss** discovered before the commencement of this policy or **loss** discovered after the expiry date of this policy regardless of the time at which the act or acts giving rise to the **loss** occurred. #### Reckless Conduct m. **Loss** resulting from recklessness by the **association**. #### Securities n. **Loss** resulting from any dealing or trading in **securities**, futures or foreign currencies or funds. #### Voluntary Exchange or Purchase o. **Loss** arising out of the voluntary giving or surrendering of **money**, **securities** or other property in any exchange or purchase unless such **loss** is committed by an **associated person** acting alone or in collusion with others. #### Theft or Fraud by Directors and officers p. **Loss** arising out of or in any way connected with any fraudulent or dishonest activities, or involving collusion by or complicity, of: i. a director who at the time of the **dishonest act** owns or controls more than 5% of the issued share capital of the **association**; or ii. any shareholder who, at the time of committing such acts, had direct or indirect ownership of or control over more than 5% of the voting share capital of the **association** or any of its **subsidiaries** or any **associated association**. ### 3.18 We will not cover the association for or in connection with **direct financial loss**: i. first discovered prior to the commencement of the **insurance period**; or ii. first discovered after the end of the **insurance period**, or the **discovery period** if applicable; or iii. in any way connected with any **employee** or **third party** up to a period of 30 days from the time any director or **officer** (who is not in collusion with such **employee** or **third party**) had actual knowledge that the **employee** or **third party** had committed or was suspected of having committed any fraudulent or **dishonest act**, even if it does not constitute a **dishonest act** as defined; or iv. caused by any **employee** if a director or **officer** possessed at any time knowledge of any act or acts of theft, fraud or dishonesty committed by such **employee** prior to employment by the **association** provided the act(s) involved **money**, **securities** or property valued at $10,000 or more or failed to make reasonable enquiries prior to employment of such **employee**; or v. arising out of or in any way connected with any fraudulent or dishonest activities, or involving collusion by or complicity, of any shareholder who, at the time of committing such acts, had direct or indirect ownership of or control over more than 5% of the voting share capital of the **association** or any of its **subsidiaries** or any **associated association**. ### 3.19 We will not cover the association for or in connection with **direct financial loss** arising out of or in any way connected with any **dishonest acts** committed, in whole or part: a. outside of Australia or New Zealand; or b. outside of New Zealand, but only if the Territory specified in the schedule is stated as New Zealand. --- ## Exclusions Applying Only To Insuring Clause 1.2 (d) (Association Liability) The following Exclusions apply with respect to Insuring Clause 1.2 (d) (Association Liability) and any relevant Automatic Coverage Clause. ### 3.20 We will not cover the association in connection with any **claim** made against it for or in connection with: a. breaches of intellectual property rights, including but not limited to any actual or alleged plagiarism, misappropriation, infringement or violation of copyright, patent, trademark or trade secret; b. any actual or alleged breach of any law, whether statutory, regulatory or common law, relating to anti-trust, business competition, price fixing, unfair or restrictive trade practices, or tortious interference in any other party's business or contractual relationships; c. any actual or alleged contractual liability of the **association** under any express or implied contract or agreement. However, this exclusion shall not apply to a **claim** for an **employment practice breach** to the extent the **association** would have had such liability in the absence of such contract or agreement; d. fines or penalties or non-monetary relief; e. any obligation, or breach of an obligation, under any law or regulation providing for paid or unpaid leave of any kind or any **industrial instrument**; or f. any obligation pursuant to any law, regulation, or **industrial instrument** in respect of workers' compensation, occupational or workplace health and safety, disability benefits, unemployment benefits or compensation, unemployment insurance, retirement benefits, social security benefits or any similar law, regulation or **industrial instrument** whatsoever. --- ## Exclusions Applying Only To Insuring Clause 1.2 (g) (Taxation Investigation) The following exclusions apply with respect to Insuring Clause 1.2 (g) (Taxation Investigation) and any relevant Automatic Coverage Clause. ### 3.21 We will not cover the association for or in respect of any **tax audit costs** in connection with: a. Any improper, unwarranted or unjustified delay, refusal or failure to comply with any request made by or on behalf of the Inland Revenue Department, for the production of documents or the provision of information by the **association**. b. Inquiries from the Inland Revenue Department which are not related to an identified intention to conduct an audit or likely future audit. c. Any audit or investigation concerning income earned or where the source of income is outside New Zealand and its external territories or protectorates, or where the services giving rise to the audit are performed by persons or any corporate entity outside of New Zealand and its external territories or protectors. d. Matters arising under customs legislation. e. Any audit or investigation, where notice or information as to their likely conduct was received by the **association** prior to the **insurance period**. Receipt of such communication will have occurred when the Inland Revenue Department makes communication with the **association** or any other person acting on its behalf. f. Any fraudulent act, error, omission or misrepresentation committed by or on behalf of the **association**. g. The imposition of, or seeking to impose, any tax, penalty tax, costs, interest, fine or any fees or expenses in connection with any criminal prosecution. h. An audit or investigation of a return of income that has not been prepared or reviewed by the **accountant** or **registered tax agent**, except where the return is a prescribed sales tax return or a prescribed payroll tax return. i. **Tax audit costs** incurred after the audit or investigation has been completed. --- ## Section 4: Conditions ### 4.1 Alteration to Risk a. In addition to General Condition 6.16 (Alteration to Risk), in this policy only: i. If during the **insurance period** a **transaction** takes place, the cover provided under this policy is amended to apply only to **wrongful acts**, **employment practice breaches** and **trustee breaches** committed prior to the effective date of the **transaction**. ii. The **insured** shall give us written notice of the **transaction** as soon as practicable but not later than 30 days after the effective date of the **transaction**. iii. If, during the **insurance period**, the **association** decides to make a public offering of its **securities** in any jurisdiction then as soon as the information is publicly available, the **association** shall provide us with any prospectus or offering statement for our evaluation and assessment of the increased exposure of the **insured**, and we shall be entitled to amend the terms and conditions of this policy and/or charge a reasonable additional premium reflecting the increase in exposure. iv. At the **association**'s request, prior to the public announcement of such **securities** offering, we shall evaluate and assess the increased exposure and advise of all necessary amendments to the terms and conditions of this policy and additional premium. In this event and at the request of the **association**, we will enter into a confidentiality agreement with the **association** relating to any information provided regarding the proposed **securities** offering. ### 4.2 Basis of Valuation a. **Securities and Foreign Currency** We shall not be liable for more than the actual market value of **securities** or foreign currency determined by their closing market price or value on the day that the **loss** was **discovered** or the actual cost of its replacement, whichever is the lesser value. b. **Precious Metals** We shall not be liable for more than the actual market value of precious metals determined by their mid-spot rate on the last business day prior to the day the **loss** was **discovered** or in the event of the discovery of the **loss** after the close of the market, by their mid-spot rate on the day the **loss** was **discovered**. c. **Other property** The lesser of the actual value of other property or the actual cost of repairing other property or replacing same with property or material of like quality and value. We may, at our election, pay such actual cash value or make such repair or replacement. We may, with the **insured**'s consent, settle any **claim** by the **insured** in respect of **loss** of property, with the owner of that property. Any property for which we have indemnified the **insured** becomes our property. ### 4.3 Change of Control of Insured If during the **insurance period** there is a **change of control** this policy shall terminate at 4.00pm on the date on which a **change of control** takes effect and the benefits of this policy shall cease absolutely at that time, subject only to paragraph (b) below. In the event of a **change of control**: a. the **insured** shall forthwith give notice of such to us; b. no **claim** will be payable under this policy unless it is in respect of **loss** covered by this policy resulting from acts which occurred exclusively before the date on which the **change of control** takes effect and which was first **discovered** within 30 days of that date; and c. we shall be entitled to a pro-rata proportion of the premium (subject to any adjustment required by the terms of this policy) for the time during which the policy has been in force. ### 4.4 Claim Notifications In addition to General Condition 6.19 (Claims Notification), upon the **insured** discovering a **loss** or potential **loss** covered by Insuring Clause 1.2 (b) (Crime) the **insured** must: a. take immediate steps to ascertain the full extent of any **loss**; b. inform us of any further **losses** as they are **discovered**; c. as soon as practicable but in any event no later than 30 calendar days thereafter, submit full particulars of the **loss** in writing to us; d. provide us with any reasonably required proof and information in respect of the **loss**; and e. allow us or our nominee to inspect the **insured**'s accounting records and any **accountant**'s report on those records providing the inspection is reasonably connected with the **loss**. ### 4.5 Deductible Unless otherwise stated, the **deductible** will apply to each and every **loss** net of any amounts recovered from any person. ### 4.6 Indemnity Limit Subject to Automatic Coverage Clause 2.1 (Automatic Reinstatement for Insured Persons), our total liability under the policy in respect of any single **claim** and in the aggregate from all **claims** shall not exceed the **indemnity limit**. We may at any time pay the **indemnity limit** applying to any one **claim** or series of **claims** (after deduction of sums already paid) or any lesser amount for which such **claims** can be settled and will then have no further liability in connection with such **claims**. ### 4.7 Jurisdictional Limit The insurance provided by this policy shall apply only to **dishonest acts** committed within the Jurisdictional Limit specified in the schedule unless otherwise stated. ### 4.8 Notification of Direct Financial Loss The **insured** must give written notice to us of any **direct financial loss** as soon as practicable within the **insurance period** or within the **discovery period** if applicable, but in any event no later than 60 days after any **direct financial loss** is first **discovered**. The **insured** must, at its own cost, also: a. provide us with affirmative proof of the **direct financial loss** with full particulars within 6 months of the **direct financial loss** being first **discovered**; and b. provide us with all requested information and documents and co-operate with us in all matters pertaining to the **direct financial loss**. ### 4.9 Preservation of Right to Indemnity In the event and to the extent that the **association** is legally permitted or required to indemnify an **insured person** in respect of a **claim**, but for whatever reason fails or refuses to do so, then we shall pay on behalf of the **insured person** any **loss** arising from the **claim**. In such event, the **deductible** applicable to the Insuring Clause 1.2 (c) (Association Reimbursement) shall be paid by the **association** to us. However, the amount of the **deductible** will not be payable by the **association** if the **association** is unable to pay the amount of the **deductible** due to insolvency. ### 4.10 Prior Enquiries The **insured** must make all reasonable enquiries and take all reasonable steps to satisfy itself about the honesty and good character of each **employee** before offering him/her employment, including but not limited to checking with all referees and recent relevant employers. ### 4.11 Prosecution for Dishonest Acts The **insured**, when required by us, and at our expense, must use all diligence in prosecuting or assisting to prosecute any person in respect of whom a **loss** arising from a **dishonest act** is paid under this policy. ### 4.12 Recoveries Where any amount is recovered from any person in respect of a **loss**, whether or not the **indemnity limit** has been or may be exhausted, that amount will be distributed (after deducting the costs and expenses of the recovery) in the following order of priority: a. first, to the **insured** in respect the **deductible**; b. secondly to us in respect of any and all amounts paid or payable by us under this policy; c. thereafter to the **insured** in respect of any part of **loss** which is uninsured for whatever reason. ### 4.13 Severability and Non-Imputation No state of mind or knowledge possessed by any one **insured person** will be imputed to any other **insured person** for the purpose of determining whether any provision in this policy applies. However, any state of mind or knowledge possessed by any past or present chairman of the board, chief executive officer, director, chief operating officer or chief financial officer of the **association** will be imputed to the **association**. ### 4.14 Single Policy / Single Loss a. If the **insured** comprises more than one person, this policy shall nevertheless be and remain a single contract of insurance for the benefit of the **insureds** as joint-insureds except as provided in General Condition 6.28 (Fraudulent Claim). b. Where **loss** results from a series of related, continuous or repeated **dishonest acts** of an **employee** or a **third party** the **loss** shall be treated as one **loss** and in particular all **loss** as a result of the **dishonest acts** of any one **employee** or **third party** acting alone or in collusion with others will be treated as one **loss** regardless of the means by which the **loss** was caused. --- ## Section 5: Definitions For the purposes of this policy: ### 5.1 Accountant or registered tax agent means a person who is engaged by the **association** who is not an **insured** and is recognised by Chartered Accountants Australia and New Zealand (formerly the Institute of Chartered Accountants) or similar, or any other person registered by the Inland Revenue Department as a tax agent. ### 5.2 Act of Parliament means any Act of the New Zealand Parliament, including any amendment to or re-enactment, and any code, rules, regulations, bylaws or other subordinate legislation made under such Act. ### 5.3 Associated association means any Association in which the **association** or any **subsidiary** owns on or before the inception of the **insurance period** at least 25% of the issued and outstanding voting shares. ### 5.4 Association means: i. The not for profit entity or entities specified in the schedule; and ii. Any **subsidiary** or **associated association** in existence at the commencement of the **insurance period**. ### 5.5 Associated person means any natural person, other than a director or partner, who has entered into or works under a contact of service with the **association** and whom the **association** compensates by salary, wages and/or commissions and whom the **association** has the right to govern and direct in the performance of such service. It includes any: i. director or trustee of the **association** but only in respect of **dishonest acts** performed while acting within the scope of the usual duties of an **employee** of the **insured**; ii. part-time or temporary **employee** performing the duties of an **employee** under the **association**'s supervision; iii. retired **employee** appointed by the **association** under a written contract whom the **association** governs and directs in the performance of their service as an **employee**; iv. student, secondee or volunteer pursuing studies, gaining work experience or performing the duties of an **employee** under the **association**'s supervision; v. ex-**employee** of the **association**, for a period not exceeding 90 days following the formal termination of their employment with the **insured** (other than where such termination is as a result of a **dishonest act**); or vi. person provided to the **insured** by an employment agency (or similar source) to perform the duties of an **employee** under the **insured**'s supervision. vii. **employees** of any Association or firm authorised and retained by the **association** to perform normal administrative services which the **association** outsources to such Association or firm provided that: a. such services are provided under a written contract; b. the **association** has the right to audit the performance of such services; c. the **association** can demonstrate that the outsourced Association or firm has been checked for competency, financial stability and honesty prior to the retention of such Association or firm; and d. any indemnity provided is in excess of any valid and collectible indemnity, contractual or otherwise, available to the Association or firm or to the **insured** or which would be valid and collectible except for the application of an excess or the exhaustion of a policy limit. **Associated person** does not include any person who is or acts on behalf of any external auditor, external accountant, broker, investment adviser or investment manager, consignee, contractor or other similar agent or representative unless specifically agreed by us and endorsed to this policy. ### 5.6 Benefits means any amount payable including pensions, welfare, shares or share options, charity, shares or share options for past, present or future **employees** (not including directors, partners or trustees) to a beneficiary of a **fund** by the trustee under the rules governing the **fund**. ### 5.7 Business means the business of the **association** specified in the schedule. ### 5.8 Change of control means the effective consolidation, amalgamation, merger, transfer, assignment, pledge or sale of a majority of the assets or shareholding of the **association** with or to any other entity which was not an **insured** at the commencement of this policy or became an **insured** during the **insurance period**. ### 5.9 Civil liability means a legally enforceable obligation to a third party. ### 5.10 Claim means: a. any formal administrative or regulatory proceeding against the **insured**, including any arbitration, mediation, conciliation or alternative dispute resolution proceeding, alleging an **employment practices breach**, **trustee breach**, **wrongful act**, or **dishonest act**, b. any civil proceeding brought by a third party against the **insured** for recovery of compensation or damages; c. any written or verbal demand by a third party upon the **insured** for monetary relief. d. any circumstance that the **insured** becomes aware of, and the **insured** or a reasonable **insured** should consider may give rise to any of (a), (b) or (c) above. All **claims** which arise out of or are attributable to or are in any way connected with a single **wrongful act**, **employment practice breach**, **trustee breach** or **dishonest act** shall constitute a single **claim** for the purposes of this policy. A single **wrongful act**, **employment practice breach**, **trustee breach** or **dishonest act** means all respective **wrongful acts**, **employment practice breaches**, **trustee breaches** or **dishonest acts** which are related or form part of a series of related conduct or form part of a course of conduct that is not entirely unconnected, different and/or unrelated. ### 5.11 Committee means: a. any auxiliary committee, foundation, trust (other than a superannuation trust), or fundraising committee; b. any disciplinary, examining or research body or committee; or c. any sporting or social club committee. ### 5.12 Credit arrangement means any credit agreement, extension of credit or hire purchase agreement, loan or transaction in the nature of a loan, lease or rental agreement, invoice, account or otherwise evidence of debt, payments made or withdrawals from any customer's account involving items which are not finally paid for any reason. ### 5.13 Crisis event means any of the following unforeseen events where, in the reasonable opinion of the chief executive officer (or equivalent) of the **association**, the event has the potential to cause an imminent decrease of greater than 30% of the total consolidated annual revenues of the **association** if left unmanaged: a. the sudden, unexpected death or disability of any executive; b. loss of a major customer, contract or credit facility; c. **employee** workplace violence; d. the first apparent unauthorised intrusion into any of the **association**'s computer facilities; e. a recall or boycott of any product; f. a man-made disaster; or g. any criminal or fraud investigation. **Crisis event** does not include an event that affects a **association**'s industry in general, rather than a **association**, specifically. ### 5.14 Crisis loss means the reasonable and necessary fees, costs and expenses paid by the **association** for external crisis management services provided in response to a **crisis event** within the first thirty (30) days after the event. ### 5.15 Data means: a. information such as text, numbers, sounds and images that can be processed by any form of electronic device; and /or b. deeds, wills, agreements, maps, plans, books, letters, policies, certificates, forms and documents of any nature, whether printed, written or reproduced by any method including computer records and electronically stored data, but does not mean bearer bonds or coupons, stamps, bank or currency notes, **money** or any negotiable instrument. ### 5.16 Deductible means the amounts specified in the schedule. ### 5.17 Defence costs means reasonable costs, charges, fees (including but not limited to legal counsel's fees) and expenses reasonably incurred by the **insured**, as applicable, with our prior written consent in investigating, defending or settling a **claim**. It does not include regular or overtime wages, salaries or fees of the directors, **officers** or **employees** of the **insured** incurred in attending, defending, investigating or monitoring claims, any internal or overhead expenses of the **insured** or the cost of the **insured**'s time or any loss of earnings or profit. In respect of Automatic Coverage Clause 2.22 (b) (Official Investigations and Inquiries – Cover for Association) and Insuring Clause 1.4 (Advancement of Defence Costs) **defence costs** means the reasonable costs of the **insured**'s legal representation reasonably required for the attendance at any official investigation, examination or inquiry. ### 5.18 Direct Financial Loss means direct financial loss to the **association** directly caused by the loss of **money**, **securities** or other property owned by the **association** or in the care, custody or control of the **association** at the time of that loss and for which the **association** is legally liable. **Direct financial loss** does