Board reviews insurance renewal as Liberty Mutual seeks retroactive change; approves student-accident coverage

The New Hanover County Board of Education reviewed its annual insurance renewal and related coverage options during its agenda-review meeting, hearing that the district's insurer is proposing a retroactive change that could narrow coverage for older misconduct claims.

Board members were told staff recommends renewing the district's package while continuing negotiations with the carrier. At the same meeting the board approved a student-accident policy to extend coverage to all students and approved the district's contract for legal services and the catastrophic athletic insurance renewal.

The recommendation to renew the district's package was presented by an insurance representative. The district's proposed renewal would increase the total premium for several lines (general liability, school leaders, crime, auto, workers'comp and cyber) to about $1,907,480, a 3.71% increase from the prior year, staff said. The presenter said one proposed endorsement would restrict firearms coverage if schools armed staff, and a separate proposed change would move the carrier's retroactive date for sexual-misconduct (abuse/misconduct) coverage forward, potentially eliminating so-called 'tail coverage' for incidents that predate the new retro date.

Board Member Pat Bradford asked about alternatives including higher district self-insured retentions. The insurance presenter said the district's current self-insured retention for abuse/misconduct is $250,000 and that retroactive-date changes are part of a national market shift driven by new and reopened historical claims.

Recognizing the potential legal and financial consequences, board members directed staff to continue negotiations and to bring more detailed comparisons and options back to the full board. Board members pressed for legal analysis and said they wanted clearer breakdowns of what the changes would mean for past and future claims.

Separately, the board approved two items brought forward during the agenda-review meeting: (1) a contract for legal services and (2) a districtwide student-accident insurance policy intended to cover all students for school-sponsored activities. Staff said the student-accident policy will cost the district an additional $18,817 overall and equals roughly $0.88 per student; the policy will cover athletic catastrophic risk for middle and high schools and expand an optional voluntary parent policy. District staff confirmed the current insurance budget can absorb the purchase.

Board members also asked the insurance representative to return next week with additional details, and staff said they would seek further legal and procurement guidance about market options, separation of coverages (for example, whether abuse/misconduct coverage can be purchased separately), and the financial tradeoffs of higher retentions or partial self-insurance.

Board action and next steps: the board approved the student-accident purchase and the contract for legal services at the agenda-review meeting and voted to continue negotiation and information-gathering on the district's broader insurance renewal. Staff will return with further vendor comparisons, legal analysis about retroactive endorsements, and cost scenarios for altered retentions or alternative market solutions.

Ending: Staff told the board the district is negotiating with Liberty Mutual and related markets; members asked for clearer, written comparisons and legal input before any final long-term commitments are made.