Issue - meetings

[Report of the Assistant Director for Corporate Governance. To be introduced by the Cabinet Member for Corporate Resources.]

This report will seek approval to award the contract for Insurance Arrangements  to successful tenderer(s) for the following: Commercial, Crime, School Journey, Motor Fleet and Engineering Inspection.

The Cabinet Member for Corporate Resources introduced the report which informed Cabinet of the procurement process undertaken, via the Insurance London Consortium (ILC), and further sought approval to appoint a provider(s) for Motor Fleet Insurance; Property Insurance Services for Commercial Properties; provision of the Engineering Inspection Programme; Fidelity Guarantee (Crime) Insurance; and School Journey Insurance with effect from 1 April 2018, for a period of three years with the option to extend for two further periods of one year each.

Further to considering the exempt information contained at item 23,

RESOLVED

To approves the award of the contracts for the provision of the Insurance Services and Engineering Inspections via the ILC, effective from 1 April 2018, for a period of three years with the option to extend for two further periods of one year each (i.e. 3+1+1) to the following providers:

·         Motor Fleet (Lot 1) to Zurich Municipal;

·         Property Insurance Services for Commercial Properties (Lot 2) to Zurich Municipal;

·         Engineering Inspection Programme (Lot 3) to Zurich Municipal;

·         Fidelity Guarantee (Crime) Insurance (Lot 4) to Risk Management Partners; and

·         School Journey Insurance (Lot 6) to Risk Management Partners.

Reasons for decision

The current insurance and inspection contracts commenced on 1 April 2013 and were based on a three-year agreement with an option to extend by a further two years. No further extensions are available; therefore, a new procurement process was required. It is necessary to ensure that the new contracts are in place from 1 April 2018, to avoid any gap in insurance cover for the Council.

Alternative options considered

Purchasing stand-alone cover for the Council, using agreed procurement processes. This was not considered appropriate because:

·         Haringey Council’s membership of the ILC has enabled it to benefit from significant economies of scale in procuring policies for a number of local authorities; these economies of scale would not be available if the Council were to opt for a single authority procurement route;

·         Membership of the ILC has also allowed the Council to share best practice on insurance and risk management practices, which would not be available on a stand-alone basis; and

·         The insurance market for local authority risks has historically had a limited number of competitors. Procuring through the ILC has previously increased the number of providers willing to respond and resulted in reduced policy rates.

Using another framework agreement to run a mini-competition for services. The Government’s Crown Commercial Services (CCS) has an insurance framework in place which the ILC has used in a previous procurement exercise in 2014. Using the CCS framework resulted in fewer respondents, decreased competition and lower value for money for the ILC and Haringey Council. Using the CCS framework was considered prior to the start of the procurement process, but discounted based on previous outcomes achieved.