School leaders join forces to launch staff absence insurance

A group of school leaders has joined forces to offer an alternative staff absence insurance, with talks ongoing to roll the scheme out even further.

Education Mutual, a group of 20 school leaders based largely in the north east of England, wants to find a collaborative way for schools to pay lower insurance fees and retain some of the profits for themselves.

However, specialists are worried about the level of protection the scheme offers.

Staff absence insurance covers schools for the cost of supply teachers and often protects against longer-term absence, including jury service, serious illness and personal injury, but can also include stress and maternity cover.

The service, which launched in September, is run as a mutual, which means it is owned by its members. It does not plan to make a profit, with all money not paid out in claims returned to members through benefits such as lower fees or enhanced packages.

Nick Hurn, headteacher of Cardinal Hume Catholic School in Gateshead and chairman of Education Mutual, said: “If this is something where we can bring benefits to every school, it’s worth putting our weight behind it.

“It’s for schools, by schools. That’s our tagline.

“I know it sounds like a utopian idea, but I’m hoping we are going to really grow and become a market leader. Then we’ll be able to drive costs down and improve the service across the board.”

The mutual employs an insurance company to provide the service, including managing the quotes and claims, for which it receives 20 per cent of fees. The remaining 80 per cent is paid out in claims or returned to members in benefits.

The amount schools pay Education Mutual varies depending on their size and what kind of cover they have. Hurn said his 1,400-pupil school pays £25,000 a year for a scheme that includes health care cover for staff.

John Brady, chair of the education insurance provider Schools Advisory Service, said this fee was slightly below average for the sector, but warned the mutual could be unable to pay all its claims if it did not make enough money.

He highlighted Education Mutual was not registered with the Financial Conduct Authority, which could make it hard for schools to launch an official complaint or receive compensation if something went wrong.

However Hurn said a mutual does not require such governance.

Hurn also said members of Education Mutual would be protected from any shortfalls in the first two years by its stop-loss insurance, which is a policy designed to limit a company’s losses to a specific amount.

The service has been welcomed in the wider sector. The Association of School and College Leaders, for instance, is considering promoting the service among its members.

Geoff Barton, ASCL general secretary, said: “It’s a very good idea and shows how school leaders working together are bringing real benefits to the education system. That’s in keeping with the spirit of a school-led system which utilises the expertise and knowledge within the profession.”