200410 10 Tenants Home Contents Insurance Scheme by chenmeixiu


									                   WIGAN AND LEIGH HOUSING

Tenants Home Contents Insurance Scheme
Report of the Director of Housing Management
Author: John Choudhury                 Tel. No: (01942) 702854
e-mail: j.choudhury@walh.co.uk

To inform Board Members of the Council Decision to extend the current contract for the
Tenants Home Contents Insurance Scheme until April 2013.

Board is asked to note contents of report.

For decision, discussion or information?              Information

For the open part or the press and public             Open
excluded part of the agenda? If press and
public excluded please state reason.

Resource and Value for           None - within existing resources.
Money Implications:

Employee Implications:           None

Key Risks incl. Company       None
reputation, business
relationships, health and
safety and legal implications

Equality (Impact) Assessed?   Yes            No             Not Applicable       X
Equality & Diversity and    The scheme improves access to home contents insurance for
Community Implications:     disadvantaged groups.

Impact on                        Premiums will be frozen until April 2013 with additional terms
Tenants/Customers:               being considered by Aviva.

Environmental Implications:      None

Area Forums Affected:            All

Tracking/Process                 Consultation         Area Forum/s   Committee        Board
                                                                     20 Apr 2010

                                        Page 1 of 3
1.0   Background

1.1   The Tenants Home Contents Insurance Scheme was launched on 3rd April
      2000 and provides home contents insurance to tenants, payable weekly with
      their rent. It is open to all tenants with a clear rent account with no penalties
      for living in a ‘high risk’ area.

1.2   The scheme is administered by Wigan and Leigh Housing on behalf of Wigan
      Council, in conjunction with AON who act as brokers. Cover is provided by
      Aviva (formerly Norwich Union).

2.0   Current Position

2.1   The scheme provides tenants with the option to take out contents insurance
      cover and pay for this weekly with their rent. Table 1 below shows the levels
      of cover and weekly premiums which have remained unchanged for 2010/11.

2.2   Table 1 – Levels of cover and premiums

       Level of Cover Standard Cover         Standard
                          Weekly Cost     cover including
                           (48 weeks)     full Accidental
                                          Damage Cover
                                            (48 weeks)
          £6,000*             £0.88             £1.10
          £7,000*             £1.03             £1.29
          £8,000*             £1.18             £1.47
           £9,000             £1.32             £1.66
          £10,000             £1.47             £1.84
          £11,000             £1.61             £2.02
          £12,000             £1.76             £2.21
          £13,000             £1.91             £2.39
          £14,000             £2.06             £2.58
          £15,000             £2.20             £2.76
          £16,000             £2.35             £2.94
          £17,000             £2.50             £3.13
          £18,000             £2.65             £3.31
          £19,000             £2.79             £3.50
          £20,000             £2.94             £3.68
          £21,000             £3.09             £3.86
          £22,000             £3.23             £4.05
          £23,000             £3.38             £4.23
          £24,000             £3.53             £4.42
          £25,000             £3.68             £4.60
      * Only available to people over 60 years of age.

2.3   Unlike some policies offered in the private sector there are no penalties for
      living in high risk areas.

                                    Page 2 of 3
2.4   Social housing tenants are more likely to be financially excluded. This means
      that they do not have access to a full range of financial services. Access to
      low cost insurance, bank accounts and cheap credit all contribute to a person
      being financially included. The provision of this low cost weekly paid
      insurance scheme to Council tenants clearly falls within the financial inclusion

2.5   In 2007, an offer was made to improve the terms of cover available to tenants
      in return for agreeing to a two year extension to the contract which would see
      the contract running until 2011.

2.6   After consulting with Wigan Council, the offer was accepted.

2.7   In February 2010, we were again contacted by the brokers AON who stated
      that the insurer, Aviva were offering the following:-

         •   a further two year extension through to April 2013.

         •   The existing rates would be fixed until 2013 regardless of loss

         •   The 6% loyalty bonus would continue subject to the combined loss ratio
             remaining below 60%.

2.8   Aviva are also considering offering other terms although at the time of writing
      this report nothing has yet been confirmed.

2.9   Discussions have taken place with Wigan Council and it has been agreed that
      the offer be accepted although the Council will require the re-tendering of the
      contract for cover from April 2013.

3.0   Conclusions

3.1   The Home Contents Insurance Scheme is continuing to perform successfully
      in attracting and retaining policyholders and supports the financial inclusion

3.2   Premium rates will remain unchanged until April 2013 with increased benefits
      for policyholders being considered.

3.3   The Council has instructed that the contract will not be extended beyond April
      2013 and that it will be subject to tender.

4.0   Recommendations

4.1   Members are asked to note the contents of this report and the need to tender
      for this service to continue when the current contract expires in April 2013.

                                    Page 3 of 3

To top