The Education Funding Agency (EFA) has issued new information about a voluntary scheme offering academies and free schools an alternative to arranging their own insurance cover.
In guidance published on 8 April, the EFA gave further details of the new risk protection arrangement (RPA), first highlighted in mid-February, which will come into effect from 1 September this year.
The guidance stressed that the RPA was not an insurance scheme but “a mechanism through which the cost of risks that materialise from 1 September 2014 will be covered by Government funds”. The RPA will reimburse academies for losses including:
- loss or damage to property (including minor works)
- legal liability to pay compensation to employees for death or injury due to employment with the academy (including as a result of exposure to asbestos)
- legal liability to pay compensation to third parties for death, injury or property damage (including as a result of abuse or exposure to asbestos)
- loss of academy property due to employee dishonesty
- loss of money and personal baggage whilst travelling on academy business in the UK
However, academies will need to make a contribution towards the costs for some types of loss. The EFA said it was important that academies “manage their risks effectively” and that before the RPA gets under way, it would provide access to support including an online risk assessment tool.
There is no cost or premium to join the RPA but £25 per pupil, or per place in special and alternative provision academies, will be deducted from an academy’s general annual grant (GAG) by the EFA for the first two years of the RPA.
If an academy’s current insurance arrangements are due for renewal before 1 September 2014, it can either:
- enter into a new contract up until 31 August 2014, or
- renew for a 12-month period and then opt in to the RPA
Once they have opted in, they will be automatically included in subsequent years but can opt out if they wish.
The EFA said: “Academies need to provide as much notice as possible before opting into the RPA and must not have a period when they are not covered by commercial insurance and have not joined the RPA.”
Cost-effective insurance is only one aspect of the issues academies and free schools need to consider in maximising the value of their resources. At Nicklin, our academies team can provide comprehensive advice and a wide range of services to support academies and free schools in obtaining maximum benefit from their greater financial freedom and budgetary control. For more information, please contact us.