Insurer working on future pandemic coverage for school boards, post-COVID

As the Ontario government prepares its school re-opening plan, the insurer for the majority of the province’s boards is working on a plan to provide pandemic coverage, albeit for future pandemics and not for COVID-19.

Within the next six to eight months, the Ontario School Boards’ Insurance Exchange (OSBIE) “may have a product that provides more specific coverage to school boards in the event of a pandemic,” said Jim Sami, CEO of Guelph-based OSBIE, in an interview this past Friday. “This would not provide coverage related to COVID-19 but will provide both first party and third-party coverage relating to future pandemics.”

At the moment, if a school insured by OSBIE is sued by a third party, and the pleadings allege there was COVID-19 transmission, OSBIE would have no automatic duty to defend unless it also alleges that the school board was in some way negligent, said Sami.

[Generally insurance is intended to cover sudden and unforeseen risk, rather than an event with a high probability of happening].

“If there is a duty to defend, there is not necessarily a duty to indemnify,” said Sami. “If it is found that the proximate cause of the loss was a result of an act of God, and there is no negligence in the school board handling or maintenance, then there would be no liability found against the school board and hence no indemnification from OSBIE.”

OSBIE insures about 90% of school boards in Ontario, and that includes liability coverage. School boards can either buy insurance from OSBIE or from a different insurer.

COVID-19 was declared a pandemic shortly before Ontario schools closed for the March break. Initially the plan was to close for three weeks (including the March break), but in the end students did not physically return to class for the remainder of the school year. This was done to reduce the opportunity for the disease to spread. Most people who get sick or die from COVID-19 have been older adults. Some studies indicate about four in 10 people who catch the disease have no symptoms at all, yet asymptomatic carriers can still can transmit the virus to others, The Associated Press reports.

Quoting Ontario education minister Stephen Lecce (pictured, above), The Canadian Press reported last week the provincial government is finalizing school reopening plans with provincial health officials including Ontario’s chief medical officer. “We believe we’ll be able to unveil it next week,” CP quoted Lecce as saying July 23 at a press conference.

The education ministry had asked all 72 of Ontario’s school boards to prepare plans for three possible scenarios:  a full-time return to in-person learning; virtual classes for all; or a hybrid model that combines the two, CP reports.

“We do not yet have clear direction on how exactly they are going to re-open and whether it will depend on the region or the age group of the students,” Sami told Canadian Underwriter Friday.

“How schools manage the risk of disease transmission depends on how the Ministry of Education proceeds with re-opening. They are looking for various scenarios and each one would have specific risks that need to be addressed. For example, full opening, partial opening, virtual opening or hybrid.”

Feature image: Chris Young, The Canadian Press