Every school, in Hong Kong or elsewhere, is facing unique kind of risks due to the nature of their business. A single incident can lead to high compensation, and even close temporary school facilities and tarnish the reputation for a long time. Schools need to review carefully their insurance policy to make sure each and every possible risks are covered properly: there is no package solution that can cover all risks, it will require a tailor made coverage as each school will have specific set of risks.
In this article, Clema Risk Solutions will list the main risks that schools are facing and what insurance they should take against such risks.
1/ Public liability insurance
Public liability is clearly the number 1 risk for schools: with the number of students and visitors within the premises every day, any accidents can possibly lead to a public liability claim. A student gets a fracture during football match, or visiting parents slip in the campus staircase, all of this may lead to public liability claims. Also, coverage needs to be extended to bus network when transportation to and from school is organised.
2/ Property insurance and business interruption
Like any building, schools’ premises may be damaged by natural disasters like flood, fire or explosion. It is therefore a basic necessity to cover all school assets against those risks, and cover as well as the loss of profit following property damage, if the school is temporarily closed. As for the assets to be covered, schools should not forget to cover as well their books and other education material as well in library: replacing all that will be expensive considering the number of items collected over the years.
3/ Travel insurance
Many international schools in Hong Kong will organise overseas trips. Though children may be well covered in Hong Kong, it may not be the case outside. And schools will have the liability in any case if they fail to protect the child against risks during school trips. So buying a comprehensive travel insurance, covering the medical expenses, repatriation as well as public liability insurance overseas is very important. Coverage can be bought on an individual basis for each and every trip or on an annual basis covering all outbound trips organised by the school during the year.
4/ Educator’s Professional Indemnity
Educators will unlikely be sued for not performing their professional duties, but they may be subject to sexual harassment claim from their students even if they have done nothing wrong. Protecting them against this risk is essential as both the teacher and school will have to pay lawyer fees to defend themselves. Even if they are clear from any prejudice by justice, their reputation will be impacted, and public relation campaign will be needed to restore it. All of this can be covered by professional indemnity insurance.
5/ Directors and officers’ liability insurance
Schools’ board of directors as well as school management (non-educational staff) will be exposed to claims from investors, parents or authorities if they have failed in their duty. With the number of risks they are facing, it is important they are properly covered, especially since many board members of schools are working on a pro bono basis. Directors and officers liability insurance will cover the legal defence costs as well as indemnity that school and/or board member will be required to pay.
6/ Employee compensation
Though educational staff may not be much exposed to work related accident, employee compensation is compulsory for all staff in Hong Kong: in the event of a work related accident, schools will be required to pay an indemnity according to level of disability and will have to continue paying the salary during the absence at work.
7/ Cyber insurance
Like every business, cyber risks are growing all over the globe. Though schools are not particularly exposed compared to other business, making sure that IT system is well protected and putting in place a basic cyber insurance will protect your business against loss of private information or IT system failure following an attack.
The large amount of specific risks that schools are facing will require special attention when designing an insurance solution. Contact our team in Hong Kong if you want to review your existing scheme and get impartial advice from us. Clema Risk Solutions has offices in Singapore, France, Hong Kong and Mainland China.