Greene King opts for self insurance

By Tony Halstead Greene King has begun to self-insure its 600 managed pubs in a scheme which means that it pays for all property damage up to around £500,000 per claim. The company's "material self-insure" scheme means it is insured for losses in excess of about £500,000 but faces paying for any losses under the figure. The move follows dramatic in-creases in premiums across the entire leisure industry, with insurance companies trying to recoup losses after the terrorist attacks of 11 September 2001 and a spate of flooding claims. The nightclub sector has been particularly hard hit and is trying to organise its own industry-wide insurance scheme. Greene King marketing director Adam Collett said: "For the vast majority of claims we are, for all intents and purposes, self-insured. It drastically reduces the insurance premiums but brings much higher risk. "It is something we review every year and although we have had a couple of pub fires there is no single issue that forced us to go down this route. "We looked at the liability, how much we were spending and the projected cost of premiums and excess charges. "It was felt it would be more cost-effective to handle things ourselves, so we put more money into a fund which is used to meet the cost of claims, and this covers floods, fires and major risks. Public liability though has to be handled separately," he said. Self-insurance is nothing new for the trade and major companies like Whitbread have in the past handled their own insurance arrangements. But the growth of dedicated trade insurers led to more companies putting their insurance risks through specialist companies. However, huge increases in premiums in the aftermath of 11 September, plus rising crime, have forced companies to look elsewhere. Tenants and individual licensees have been urged to continue shopping around for the best deals. Federation of Licensed Victuallers Association chief executive Tony Payne said: "Licensees should not always think that the lowest premium offers the best deal because there are some big charges for excesses, so that is why they should read the small print very carefully.