Staff absence insurance case study

The risk

More than 10 years ago Leicestershire schools approached the Local Authority, keen to further protect school absence budgets; they requested a replacement for the existing Authority mutual fund. The Local Authority’s Human Resource Department at that time, managed the mutual fund available to schools. Schools felt the mutual fund facility was not meeting their needs. They wanted a risk transfer mechanism with more flexibility.

The schools knew the ‘one size fits all’ approach of the mutual fund wasn’t working; schools varied in size, had different staffing levels, teacher cover availability and budget constraints. The schools wanted more choice; to be able to select cover that would meet their individual needs.

The mutual fund had not been performing well, there was a risk of deficit and the schools did not want the threat of year-end clawbacks. The Authority’s Insurance and Risk Management specialists turned to the commercial insurance market to find a solution.

The solution

The education and insurance departments conducted a survey of schools which identified what would be required of a commercial staff absence insurance scheme. The Authority invited several commercial insurance providers to present the benefits of the insurance schemes they could offer and to indicate costs. After undertaking a rigorous best value analysis Risk, Insurance and Education Managers selected the accident and illness insurance scheme offered by BEST.

The scheme 1996 – present

The scheme provides schools with security, flexibility and choices of cover. Each school participating in the scheme is individually underwritten. The scheme provides a low claims rebate facility for schools from which many participating schools have benefited.

Administration of the scheme is undertaken as a partnership between the Authority’s education insurance department and the BEST team. The education insurance administration team receive claim notification from schools which they forward to BEST. The Authority administer their own renewals but BEST staff deal with enquiries from schools wishing to join the scheme.

Schools participating in the scheme have access to  BEST’s staff wellbeing support mechanisms (helplines and orthopaedic rehabilitation service).

“The Authority closely monitors absence levels and trends across all our schools, by working in partnership with our insurance provider we are able to ensure our schools are adequately protected.

“We choose to play an active part in administering the staff absence insurance scheme and the Authority has a proactive approach to attendance and absence management. The focus is on reducing risks for schools and providing adequate support. Access to BEST’s insurance scheme, helpline facility and orthopaedic rehabilitation service assists us in achieving our objectives.”

Carolyn Bullock,
Children and Young People’s Service Insurance Team Leader,
Leicestershire County Council