Mutual expects recent high court decision to be overturned in Court of Appeal.
Islington London Borough Council has joined LAML, the Local Authorities Mutual Ltd,its seventh fully participating member.
It joins Croydon, Camden, Haringey, Harrow, Lambeth and Tower Hamlets in the mutual, with others planning to join over the next three years.
Mike Curtis, director of finance, and Islington LBC, said: “We’ve reduced annual contributions to the insurance reserve by embracing risk management and being prepared to innovate. Collaborating with like minded authorities to reduce cost and drive savings through pooled insurance risk through LAML was what we wanted”.
LAML chairman Nathan Elvery, executive director of resources & customer services at Croydon LBC, said; “There could be no better proof that despite the recent court decision in RMP v Brent LBC, LAML is going to continue to attract councils that want to cut the cost of insurance premiums for its members and therefore its citizens by as much as 15%.
“We are challenging that decision in the Court of Appeal in the autumn and are not alone in expecting the lower court’s verdict to be overturned.
“Parliament intended local authorities to use their new wellbeing powers to save the citizen cost and to reduce their risks. That is what LAML does.
“The rapid growth and development of LAML shows how we are demonstrably serving the appetite of London for meeting stringent efficiency targets while enhancing risk management”.
“The new company has no shareholders, so all surpluses are ploughed back into the business, further reducing premiums for members and costs for council taxpayers. It has also increased competition in the local government insurance market, which was limited to just three providers”.
LAML’s adviser, Martin Fone, chief executive of Charles Taylor’s Non-Marine Mutual Department, said: “The concept of a mutual is very simple; the members insure some or all of their risks with the mutual instead of directly with commercial insurers. They pool the risks and share the costs. The mutual then reinsures those levels of risk - over and above the level of risk it retains itself - in the conventional marketplace”.
