Council chiefs are exploring options to set up a local government mutual to reduce the amount councils spend on insurance every year.
Councils nationally spend more than £650m a year on insurance ranging from property damage and fleet cover to employers’ liability and protection against cyber-attacks.
The Local Government Association (LGA) is working on a new mutual for local authorities that, they believe, will deliver better cover and service at a reduced cost.
The mutual - a company which is owned by and provides products and/or services to its members - will also allow for the sharing of best practice between member authorities.
‘Councils spend hundreds of millions of pounds on insurance nationally,’ said LGA chairman Lord Porter. ‘They also routinely work together to share best practice and support each other to improve, but currently are limited in doing this by understandable confidentiality around insurance contracts.
‘The LGA has for some time been exploring options for the development of a cost effective alternative to the conventional insurance market products and services available to local authorities.’
‘Mutuals are long-established and trusted,’ Lord Porter added.
‘A local government mutual would save councils money and give members the chance to control and manage their risks, claims and cover more effectively.’
The LGA chairman also called on councils to come together in order to form the mutual. This is, he said, the ‘crucial next stage’.
