The Incorporated Societies Act 2022 replaced legislation that had been in place since 1908 — literally over a century without meaningful reform. The new Act came into full effect in 2023 and introduced significant changes for the approximately 24,000 incorporated societies in New Zealand, many of which are registered charities, sports clubs, community organisations, and professional associations.
Key Changes Under the New Act
Explicit Officer Duties
The 2022 Act introduced — for the first time — explicit duties for officers of incorporated societies. Officers (which includes committee members, not just paid executives) now have legal duties to:
- Act in good faith and in the best interests of the society
- Exercise care, diligence, and skill
- Not act or agree to act in a manner that creates a substantial risk of serious loss to creditors
- Not incur obligations the society cannot perform
The key word is "legal". These are now enforceable obligations — not just best-practice guidelines.
Personal Liability for Breaches
Officers can be held personally liable for losses arising from breach of their duties. The Act provides for civil remedies and, in some cases, criminal liability for serious breaches. This is materially different from the 1908 Act which provided much weaker personal liability provisions.
Re-registration Requirements
All incorporated societies were required to re-register under the new Act by April 2026. Those that didn't re-register ceased to be incorporated. Re-registration required updating constitutions to meet new requirements — including provision for officer duties and conflicts of interest.
Financial Reporting Requirements
Enhanced financial reporting requirements now apply based on the society's revenue level, bringing more transparency — but also more compliance risk for societies that fail to meet these standards.
The Insurance Implication
The introduction of explicit, enforceable officer duties combined with personal liability provisions makes Association Liability or D&O insurance significantly more important for incorporated societies than it was under the 1908 Act.
Previously, the personal liability risk for committee members was largely theoretical. Under the 2022 Act, it is expressly contemplated by the legislation. Any incorporated society — whether a sports club, community trust, hobby association, or professional body — should now treat D&O/Association Liability insurance as an essential, not optional, cover.
What Association Liability Insurance Covers for IS Members
- Legal defence costs arising from claims against officers in their capacity as office holders
- Damages or compensation awarded against officers personally
- Investigation costs from regulatory enquiries (including from the Registrar of Incorporated Societies)
- Employment-related claims against officers (personal grievances directed at the governance level)
Audit Your Current Cover
If your incorporated society has D&O or Association Liability cover, check the policy wording:
- Are all officers and committee members named as insured persons?
- Does the policy cover civil liability claims under statute?
- Are investigation costs covered, not just defence costs for proceedings that have commenced?
- Is the policy limit adequate for your society's assets and activities?
A specialist charity and community organisation broker can review your existing policy against the new Act's requirements and identify any gaps.
About the Author
The CharityInsurance Crew — the CharityInsurance crew are your friendly insurance geeks on a mission to make specialist cover simple and accessible for every NZ charity, sports club, and community organisation.