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Personnel Medical Needs and General Liability Top Losses for International Schools

Personnel Medical Needs and General Liability Top Losses for International Schools By Scott Jacobs, Special Risks Manager, Clements Worldwide The Clements Worldwide Risk Index Summer/ Fall 2016 edition (the third edition of the survey) was recently released with new sections focused on results for key industry segments.  For the international school segment there were some predictable responses, but also some surprises.


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Personnel Medical Needs The top loss cited by international schools was personnel medical needs, which contrasted with overall respondents who cited the top loss as business interruption.  With schools’ focus on recruiting and retaining quality teachers, having a top-notch medical plan is critical and this comes with costs.  Given that schools may be located in developing markets, access to quality healthcare even for routine injuries may be challenging. A client of Clements Worldwide was evacuated from an international school in the Middle East for a broken leg.  Because of the remote region where the school was located, this was considered life threatening and required evacuation. This may be why one third of international schools have stated that medical evacuation is their primary medical concern vs one fourth of overall respondents.  Additionally 11% of schools responded that they had to medically evacuate an employee in the past 6 months.  Since the cost of a medical evacuation could be more than $100,000, it is critical to ensure that your school’s insurance policy does not have limits on medical evacuation of $25,000 or $50,000 because that may not be sufficient to cover the full costs of an event.


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Spread of viral diseases is also a top concern for international schools. The increasing number and spread of infectious diseases is staggering.  “We are standing on the brink of a global crisis in infectious diseases,” said Dr. Hiroshi Nakajim, former Director-General of WHO, in the most recent World Health report. “No country is safe from them. No country can any longer afford to ignore their threat.” From Zika to Typhoid, teachers need to be prepared for outbreaks in the geographic area where they are working and get the appropriate vaccines.  Some health plans will have dedicated medical resources to provide diagnostic services for tropical diseases. A final consideration as it comes to medical expenses is student medical costs that are deemed the result of school activities.  Increasingly school trips, including sports tournaments, are occurring in the country and across borders.  A Clements client had taken students to another country for a sports tournament where a student had a severe knee injury that required emergency surgery.  The bills for the surgery were over $8,000 and not covered by the student’s/ parents’ medical plan.  These costs were instead covered by a Travel Accident Insurance policy secured by the school.

General Liability While personnel medical needs was not a surprise as the top loss for international schools, General Liability as the 2nd greatest loss was.  This category does also include Professional Liability and Directors and Officers Liability, which combined point to a number of emerging areas of risks, which indicate why this was also the top concern for international schools. A primary concern of every school is employee abuse of students, particularly sexual abuse.  Schools try to put safeguards and plans in place to protect students from predatory acts, but Clements has seen situations where even the most prepared school has a devastating incident.  Therefore, it is critical that international schools ensure that their general liability policy does not have any exclusions for sexual molestation.  Additionally, ensuring that your school has security plans in place to protect students is critical and will make a difference in any judgements during a lawsuit as the school can prove it did take this threat seriously and took precautions against such an event. Another area of coverage that requires critical consideration is Directors & Officers coverage.  Many board members do not realize that they are personally responsible for lawsuits as a result of decisions they made on the board and can still be sued after their tenure on the board is complete. But the most common type of liability claim will just be a lapse in judgement or accident.  A client of Clements recently had an incident where a student was in a school play with a prop gun used in one scene.  The gun went off too close to one student’s head, who subsequently lost his hearing.  The parents filed a lawsuit.  The school, advised by their insurance company, tried to settle out of court but the parents refused.  Ultimately the parents were awarded $75,000 in damages, but more costly were the legal fees of over $500,000.  Their general liability policy covered all these costs.

Terrorism & Political Violence International schools cited terrorism as the risk they felt least prepared for and political and labor unrest as their third greatest source of loss.  This can include anything from strikes, riots, civil unrest, as well as actually attacks.  In the current geo-political environment there is no country immune from these challenges.  Like every other type of enterprise, international schools need to ensure they have well-documented plans for how to react should any of these risks occur and train all employees on these procedures.  Having political violence insurance may also make sense depending on your location.  Taking the time to research the risks in your area including monitoring elections and other potential sources of disruption needs to be a priority to protect staff and students. If you want more details from Clements Worldwide regarding the Clements Worldwide Risk Index, you can listen to a webinar targeted at international schools or read the full Risk Index report.

The Clements Worldwide Risk Index We would love to have your participation in the next Clements Worldwide Risk Index to be released in early 2017.  We are currently collecting results and you can fill out the survey here.  The goal of the survey is to provide organizations like you with the information you need to better protect your staff and assets from international risks.

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