School System Insurance Cost Jumps 25% to $114,359 in New Year

There was little good news when the Winn Parish School Board committee received its report for ongoing insurance coverage.  Overall costs will be up 25% from 2022 coverage, with a total tab of $114,359.

The policy covers general liability, automobile liability, school leadership liability and a relatively new category providing cyber crime coverage.

A presentation was made Sept. 25 at the board’s committee session by agents from McGriff Insurance Services.  Coverage is provided through a risk-management group of 26 Louisiana school systems which includes Winn.  Louisiana Public Schools Risk Management Agency (PARMA) was formed in 2002 when other insurance companies were no longer willing to write policies due to costs.

Annually, each system pays in to cover PARMA’s loss fund.  In instances of claims, the parish is responsible for a deductible of $25,000 while the PARMA loss fund is responsible for the balance which may be considerably higher.  The agents called this a “layered approach.”

This past year, there were more awards, some of them being large, that resulted in the LARMA board announcing the increased rates for the new school year.  If there is a silver lining to the cloudy report, it was that in years when claims are lighter than pay-in, LARMA can approve dividends back to the individual school systems.

A relatively new but now high profile player in the public entity insurance picture is cyber crime.  The board heard that up to three years ago, cyber insurance was easy to get and inexpensive so PARMA simply provided it for the school systems from its loss fund.  But that changed after recent, high-profile cyber crimes.  “All of a sudden, big hacks, big headlines.”

Public entities like school boards have large amounts of sensitive information stored within their files.  But they don’t have much money to protect it apart from traditional firewalls.  One way to increase security (and in turn make insurance possible) is the use of Multi-Factor Authorization (MFA).

With MFA, once a person signs in for School Board access, a notification and temporary passcode is sent back to a device-of-record (like phone or email) to confirm that the person seeking information is who they say they are.  Business manager Jennifer Vidrine advised the board that while setting up an MFA system for school personnel can be done, working out an MFA program for students will be more complex.

Some other parishes have accomplished this by setting up a system for students that is separate from that of personnel, though still connected to the system’s database.