The risk
In 2004 BEST met with schools and Local Authority representatives. Schools were not happy with the lack of flexibility provided by the Local Authority’s mutual fund. The Authority wanted schools to have more equitable charges made on them. They felt the schools participating in the mutual fund were a combination of winners and losers. The scheme was being underwritten on an overall claims basis but not charged back to individual schools accordingly.
The solution
It was agreed by the Local Authority and schools that they would seek the assistance of a commercial insurance provider. The intention was to find a commercial provider able to replace the mutual fund and ensure schools had continuity of cover. The inception date was set at 1st April 2005.
The Authority invited applications from a number of providers and interviews were conducted. BEST were selected as they demonstrated their experience and ability to ensure a smooth transition from the mutual fund whilst offering the most economically advantageous terms. BEST offered a reduced five month moratorium on maternity leave claims to facilitate the transition of the scheme.
The scheme 2005 – present
Continuity of cover has been offered to all schools from inception of the scheme and at renewal. The scheme provides schools with security, flexibility and choices of cover. Each school participating in the scheme is individually underwritten. BEST manage most aspects of scheme administration on behalf of the Local Authority therefore reducing the Authority’s administrative burden.
“Bournemouth previously operated an in-house absence insurance scheme for schools for a number of years which was taken up by the majority of the schools. However, in the latter years of the scheme it was becoming increasingly difficult to predict absence levels and therefore accurately predict annual costs resulting in additional year end costs to schools to cover any deficit made on the scheme. The scheme could not be tailored for individual schools and although non profit making the scheme was felt by the Authority not to be offering best value for all schools buying in.
“BEST were able to work with the Authority to tailor the cover to allow a policy to be offered to schools that gave them very similar cover to that which they previously had benefited from under the in-house scheme.
“The schools who have taken a policy with BEST have been pleased with the service offered and the ability to negotiate and tailor their requirements to suit the situation of the school. The Authority does not have a large role in the administration of the scheme and merely acts as a point of contact and also centrally pays the schools premiums, which are then recharged, to the schools on a monthly basis.
"Annually BEST are able to offer statistics to the authority for the schools covered which prove useful to the authority HR team for statistical purposes.”
Karen Gee,
Schools’ Finance Support Team Leader,
Support for Children and Young People,
Bournemouth Borough Council
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