Decision details

It is recommended that the Director of Finance accept the following bids for external insurance cover from 1 October 2023. The contract period is for a three-year initial term, followed by two single year extensions (if required).
Property – The Travelers Company - £194,178.12 per annum
Liability – Risk Management Partners - £234,125.00 per annum
Motor – Zurich Municipal - £39,696.10 per annum
The total value of the insurance arrangements tendered per year is £467,999.22, plus insurance premium tax at 12%, giving an annual total cost of £524,159.13.
The total value of the contract award being placed for the whole five-year period (including extensions) is £2,620,795.65.

To provide external insurance cover in relation to the Council’s operations and assets, following a detailed expected maximum loss study. This insurance programme has been developed by the Council’s in-house finance team, aided by an appointed external adviser and appointed insurance brokers.

The Council could self-insure and buy no external insurance. Any insurance claims made would then be a cost against the revenue budget and reserves. Given the wide range of significant risks facing the local authority and the critically low level of current revenue earmarked reserves, this option is not recommended.
The Council could buy more external insurance than the premiums quoted above. This would give a more extensive coverage of the risks being faced. However, claims experience over the last ten years shows that the Council is a good manager of the risks facing it and that buying more insurance cover (above the optimal designed programme) would not represent value for money or be affordable in terms of the level of reserves held. This option is therefore not recommended.