Trainsure successful in negotiations with ESFA reducing insurance requirements

Negotiations led by Trainsure, the UK’s number one provider of insurance to the UK training sector have caused Government body, ESFA (Education & Skills Funding Agency), to rethink insurance requirements contained in training contracts.

The changes were due to come into effect from 1st August for the educational year 2019-2020. They affected contracts for 16-19 Traineeships and Adult Education Budgets (AEBs). Prior to the implementation of the changes the insurance conditions of contracts for these sectors stated that Employer Liability, Public Liability and Professional Indemnity cover had no specified limit requirement. From the 1st August 2019 this figure was to become £10m for each cover.

“ As a highly trusted advisor and insurance provider to the sector, we couldn’t understand why ESFA had set a £10m limit, in particular for Professional Indemnity, where, in general, the maximum  exposure is nearer £1m-£2m,” says Trainsure MD, Wayne Cowley.

Trainsure were also aware that a doubling of the limit would mean a big increase in premiums. “Clearly this move would have been great for our business, but not good for the training sector as a whole. Depending on the size of the training provider it could have been prohibitive for smaller outfits and, for larger ones, added tens of thousands to premiums. This is public money and would have had a direct impact on the amount available to spend on training. We wanted to raise awareness of these issues and their likely impact. So, jointly with the Fellowship of Inspection Nominees (FIN), we hosted a webinar covering ESFA’s changes to training contracts, highlighting our concerns and Trainsure’s actions to address the issues. ”

Trainsure’s eminence in the industry – they are the Association of Employment & Leaning Providers (AELP) recommended insurance partners – ensured ESFA were ready to listen to the insurance provider’s argument. As a result they have agreed to rescind the original proposal and amend the limit in 2019/20 for Professional Indemnity to £5m. In addition, ESFA have asked Trainsure to be involved in the 2020/21 review of contract requirements, which will start much earlier to allow for more consideration of any impacts on the sector.

“Clearly we welcome this move and are delighted that ESFA were happy to listen to our lobbying. The result is of benefit to trainees and the sector as a whole,” says Wayne.

He added: “Whilst the big news for training providers is the cost savings, Trainsure recommend that training providers check the changes which are in ESFA’s 4th September update. There are differences which they may not be aware of. For instance, the contract requirements for apprenticeship training when compared to adult traineeships and AEBs.”

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