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Insurance explained
Professional indemnity and employment practices liability insurance for an independent school are policies paying defence costs and compensation for claims about its advice and treatment of staff. Public liability does not usually cover either.
Part of: Professional indemnity insurance
In short
Independent schools give advice and make decisions that families rely on: university and careers guidance, special educational needs support, counselling, admissions and exclusions. A claim that this was done negligently is usually a professional indemnity matter, not public liability, because the loss is financial or educational rather than injury. Schools also employ large teams, and claims for unfair dismissal, discrimination or harassment are an employment practices liability risk, often naming the head or governors alongside the school. Both covers are commonly bought within a school package or a management liability policy, subject to the policy terms.
Professional indemnity responds to claims that the school breached a professional duty: negligent advice, a careless decision or a failure in a professional service, causing someone financial loss. For a school that can mean advice to pupils and parents, assessment of special educational needs, careers and university guidance, counselling, and decisions on admissions, exam entries or exclusions.
Employment practices liability responds to claims by employees, former employees and job applicants, such as unfair dismissal, discrimination, harassment and victimisation. Under the Employment Rights Act 1996, section 94, an employee has the right not to be unfairly dismissed. Under section 109 of the Equality Act 2010, anything done by an employee in the course of employment is treated as also done by the employer, unless the employer shows it took all reasonable steps to prevent it. So the school is usually the respondent when a member of staff discriminates against a colleague.
Both covers are usually written on a claims-made basis: the policy in force when the claim is made, and notified, is the one that responds. Continuity of cover and prompt notification therefore matter.
| Professional indemnity | Employment practices liability | |
|---|---|---|
| Typical claimants | Pupils, parents, former pupils | Staff, former staff, job applicants |
| Typical allegations | Negligent advice, missed SEN needs, wrong exam entries, poor counselling practice | Unfair dismissal, discrimination, harassment, whistleblowing detriment |
| Commonly covered | Defence costs, damages and settlements | Defence costs, tribunal awards and settlements |
| Commonly excluded | Bodily injury (a public liability matter), deliberate or dishonest acts, fines, known prior circumstances | Contractual sums such as pay already owed, reinstatement costs, fines, known prior circumstances |
Two points often surprise schools. First, PI is about the quality of what the school advised or decided, so it can respond even where nobody was hurt and nothing was damaged. Second, EPL is mainly about defence. Employment tribunal claims can take many months and involve witness statements from the head, bursar and governors, so legal costs can be significant even where the school wins.
Exclusions vary widely between insurers, so the wording should be read rather than assumed. Abuse allegations are a separate area with their own cover and conditions; see safeguarding allegations and school insurance.
A school is usually protected by several policies that each answer a different question.
Academies in the DfE's RPA have Section 5 governors' liability and Section 6 professional indemnity under the RPA membership rules. Independent schools are not eligible for the RPA, so they buy these covers commercially. The education insurance guide sets out the full package.
These examples are illustrative, not real cases.
Careers advice. A sixth former is told a course meets a university's subject requirements. It does not, and the offer is withdrawn. The family alleges negligent advice and claims the cost of an extra year. This is a typical PI scenario.
Special educational needs. Parents say a prep school failed for two years to act on signs of dyslexia, and claim the cost of specialist tuition. Again the loss is educational and financial, so PI is the relevant cover, subject to the terms.
A disputed dismissal. A teacher is dismissed after a capability process and brings tribunal claims for unfair dismissal and disability discrimination, naming the head personally. EPL usually funds the defence, and may cover individual leaders as insured persons.
A complaint that escalates. Independent schools must run a written complaints procedure for parents, including a panel hearing with at least one member independent of the school's management, under Part 7 of the Education (Independent School Standards) Regulations 2014. A complaint that ends unresolved can turn into a claim, so complaints records are often relevant to insurers.
Many schools assume professional indemnity is for architects, accountants and consultants, not for teachers. In practice, a school provides professional services every day: it assesses, advises and decides on matters that affect a child's education and future. Where the loss is financial rather than physical, public liability usually will not respond. The same logic applies to counsellors and educational psychologists employed by the school; see PI for counsellors. Schools that also sell services to other schools, such as training or consultancy, should check that activity is declared; see education consultants and PI.
Apex arranges PI, EPL and management liability for independent schools; a broker reads every enquiry.
There is no general legal requirement, but many independent schools buy it because advice on careers, special educational needs, admissions and exam entries can lead to claims for financial or educational loss. Public liability usually covers only injury and property damage, so it does not normally respond to those claims.
No. Employers' liability covers injury or illness suffered by employees at work and is compulsory for most employers. Employment practices liability covers claims about how staff were treated, such as unfair dismissal, discrimination and harassment. It is optional and is often bought as part of a management liability policy.
Yes, discrimination and harassment claims can name individuals as well as the school. Many EPL and management liability policies include senior staff and governors as insured persons, so defence costs can be funded for them too, subject to the policy terms and any exclusions for dishonest or deliberate conduct.
Academies in the RPA have professional indemnity under Section 6 of the membership rules, which is unlimited with a £1,000 retention per loss and works on a claims-made basis. Academies outside the RPA, and independent schools, need to arrange PI commercially, often within a school package.
It depends on the allegation. If a pupil was injured, the claim is usually handled under public liability. If the claim is that the school's handling caused educational or financial loss, PI may respond, subject to the wording. Abuse-related allegations usually fall under specific abuse cover with its own terms.
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Start a commercial enquiry Request a callbackApex Insurance Brokers Limited is authorised and regulated by the Financial Conduct Authority. Registered in England and Wales, company number 07014570. This page is general information, not advice on your individual circumstances, and it does not guarantee that cover will be available or on what terms.
