Insurance and liability provision

Report: 06
Date: 18 September 2008
By: the Treasurer and Director of Resources

Summary

This paper outlines the insurance renewal programme for 2008/09 and seeks approval for various renewals.

A. Recommendations

That

1. members agree the insurance policies be re-let in accordance with the terms outlined in the exempt report, with effect from 1 October 2008;

2. savings of £45,900 in 2008/09 and £91,800 in a full year be transferred to the motor insurance reserve on the balance sheet; and

3. a new property insurance reserve be established, with savings on the property policy of £92,800 in 2008/09 and £185,600 in a full year be transferred on an annual basis until a reserve of £2M has been established.

B. Supporting information

1. Heath Lambert, the Authority’s new insurance advisers have now prepared their renewal programme for both liability and property insurances, with effect from 1 October 2008. Details of the renewal are included in the linked exempt appendix 1, which summarises the renewal position on each major class of insurance.

2. Staff from the MPA and MPS staff have over the years made significant progress in refining risk information and compiling and analysing historical loss data, along with meeting and briefing key underwriters so that they fully understand the risks and risk management culture of the MPA/MPS.

3. The results of the 2008 insurance broking exercise confirm that this strategy is sound and continues to deliver benefits in both cover and cost.

C. Race and equality impact

There are no specific implications resulting from the general insurance renewal programme.

D. Financial implications

1. The linked exempt report outlines the costs resulting from the insurance renewal programme.

2. The linked exempt report identifies savings of £149,800 in 2008/09 and £299,600in a full year. It is recommended that of these £45,900 in 2008-09 and £91,800 in a full year be transferred to the existing motor insurance reserve and that a new property reserve be established, with savings on the property policy of £92,800 in 2008-09 and £185,600 in a full year be transferred on an annual basis until a reserve of £2M has been established. This will provide cover for properties valued at less than £1M for which we presently self insure.

3. The balance of savings (£22,200) will remain in the overall insurance budget to allow for unforeseen increases in risks/premiums in the main programme over the next 12 months.

E. Background papers

None

F. Contact details

Report author(s): Annabel Adams – Deputy Treasurer, MPA

For more information contact:

MPA general: 020 7202 0202
Media enquiries: 020 7202 0217/18

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