Shaer Halewood, Director of Finance and Investment (S151) introduced her report that set out information on the elements which make up the Insurance Fund, the cost of running the Risk & Insurance Section and the Budget for 2019/20.

The Audit and Risk Management Committee was apprised that the 2019/20 Insurance Fund Budget of £2,945,000 was an increase of £10,000 (0.3%) on the Budget for 2018/19. Members also noted that the cost to General Fund and covered from the Insurance Reserve Budget was £194,000, i.e. 10% higher than for 2018/19, being the result of a greater percentage of liability claims from schools compared to recent years, and due to additional property insurance premiums generated by the acquisition of major assets.

The Director of Finance and Investment informed the Committee of the principal risks that the Council currently self-insures, together with the probable maximum sum. She also informed of the premiums (under insurance contract) that had been charged in recent years in respect of the three principal risks covered by the Insurance Fund i.e. Casualty (liability), Material Damage and Business Interruption, and Comprehensive Motor Insurance.

Members noted that by self-insuring the Council avoided paying insurers’ administration profit and Insurance Premium Tax on predicted levels of claims.

A Member sought clarification from the Director of Finance and Investment about additional cost to the budget of £194,000 (earmarked for the insurance element of the Council’s Highways Contract) and whether this was a one-off occurrence or covered by internal recharge. The Director of Finance and Investment advised that internal accounting recharges would be adjusted and the General Fund would be replenished as a result. 

Resolved – That the Insurance Fund Budget 2019/20 be agreed.