Following on from our initial discussions, ALARM recently held a further Local Government Reorganisation (LGR) roundtable with insurer, broker, and legal partners to examine the evolving risk and insurance landscape associated with local government structural reforms in England. Although the government has so far confirmed LGR plans only for Surrey, set to transition to two unitary authorities on 1 April 2027, the overarching message from the session was clear: insurance and risk practitioners operating within councils potentially affected by future reorganisation should begin preparing now, ahead of any formal announcements regarding their authority’s status.
Together we have created some preparatory actions and insights for you to consider:
- Develop a comprehensive insurance asset register
Create or update a consolidated inventory of all your insurance policies and contractual arrangements, including renewal timelines, indemnity limits, perils covered, deductibles, and any legacy exposures, such as Municipal Mutual Insurance (MMI) liabilities. Historical datasets should also be captured to support transition audits and due‑diligence exercises. - Assess policy transferability to future entities
Identify which existing policies could be novated to the incoming unitary authority, commonly property/material damage and potentially motor, thereby freeing internal capacity and resources to focus on more complex lines that may require new procurement activity. - Engage early on renewal and tender implications
Where policies are due for renewal or re‑tender before the proposed LGR implementation date, initiate discussions with brokers and procurement colleagues to understand strategic options, transitional arrangements, and market appetite. - Map cross‑council risk and insurance stakeholders
Establish key points of contact within neighbouring or partner councils that fall within the proposed reorganisation footprint to support coherent planning, data alignment, and risk harmonisation. - Cleanse and rationalise claims data
Ensure claims datasets reflect only current and future service provision. For example, remove liabilities associated with schools that have converted to academy status or other functions no longer under local authority remit. - Standardise data formats and transparency
Collaborate with partner councils to agree consistent data structures, reporting formats, and visibility of available datasets to streamline due diligence and facilitate insurer engagement during transition. - Review outsourced, shared, and PFI arrangements
Analyse which externally delivered or shared services may be reintegrated into the new organisation. Additionally, assess the status of any Private Finance Initiative (PFI) schemes approaching expiry and review associated insurance, risk transfer, and asset‑handover implications.
ALARM Next Steps
As government decisions are released for the remaining councils subject to potential reorganisation, ALARM will continue to facilitate roundtable discussions and provide members with up‑to‑date insights on the insurance and risk implications of LGR. ALARM is also in ongoing dialogue with the Ministry of Housing, Communities and Local Government (MHCLG) and is seeking to further engage with the Local Government Association (LGA) to ensure the sector’s interests and challenges are reflected in national discussions.
