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Shared insurance pact will benefit ratepayers

For immediate release: Tuesday 12 May 2009

 
Ratepayers across the Bay of Plenty and Gisborne regions will reap the benefits of a shared insurance deal that will save almost $1 million annually across eight councils.

Aon New Zealand Limited has won the contract to supply insurance brokerage to the combined procurement company Bay of Plenty Local Authorities Shared Services Limited (BoPLASS).

The new insurance contract will deliver between $900,000 and $1 million savings to insurance coverage paid by the participating councils.

This will equate to between $20,000 and $200,000 a year per council depending on size. For example Western Bay of Plenty District Council could save between $50,000 to $60,000 a year in insurance payments.

Aon is New Zealand’s largest insurance broking and risk consulting company with 61 companies nationwide and operating in 120 countries globally. Aon was identified as the preferred provider from four tenderers in a process that looked at quality of service, risk management and claims management as well as price.

BoPLASS chairman Glenn Snelgrove says the awarding of the contract to Aon signals a “win-win” for councils and ratepayers and signals councils’ determination to seek the best return for the dollar in an ever-tightening economic climate in which many ratepayers are hurting.

“This is a tangible example of councils in the region taking a collaborative approach to those services that we can all share the cost of providing and it follows similar collaborative initiatives such as Smartgrowth,’’ says Mr Snelgrove.

“BoPLASS is a very successful vehicle to roll out shared services to create savings to ratepayers by working together.

“This new insurance contract will save each council between 25 to 30 percent on their annual insurance bill and will equate to savings of about $1 million per annum and these reduced costs will directly impact on rates,’’ says Mr Snelgrove.

Today’s announcement of the joint insurance contract is the largest of several shared services that BoPLASS has promoted, including library services, after hours telephone services, GIS information technology, aerial photography, internal audit, information management and group-buying of office supplies.

BoPLASS is a council-controlled organisation set up last year as a joint scheme to create single contracts across those areas where all nine councils could benefit by sharing best practice, information and collaboratively buying common services.

BOPLASS councils are Western Bay of Plenty District Council, Tauranga City Council, Environment Bay of Plenty, Opotiki, Whakatane, Kawerau, Rotorua, Taupo and Rotorua. Gisborne District Council will join BoPLASS in July. Taupo was not included in the insurance project because of previous contractual arrangements.

Aon will take up the contract on 1 July 2009, replacing the former provider Jardine Lloyd Thompson Limited.

Councils’ insurance cover includes a range of assets and risks including vehicle fleets, material damage such as fire and flood, public liability, buildings, business interruption, travel, aviation, risk (insurance against major losses) and public liability.

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