Alabama Sets Up State-Run School Teachers’ Liability Insurance Program

Gov. Robert Bentley’s administration has set up a new liability insurance plan for Alabama’s school workers who previously relied on the Alabama Education Association and other groups for coverage. How it will affect AEA won’t be known for awhile.

A law requiring the insurance plan was passed by the Republican-led Legislature this spring after three years of GOP efforts to weaken the Democratic-leaning teachers’ group.

Bentley said he didn’t sign the legislation into law to be anti-AEA. “I’m not against organizations. I know some people are,” he said. He said the legislation is intended to give employees in public schools the same coverage that state employees have had for many years.

Republicans allocated $5 million to pay for the coverage in the first year, and left the details up to Bentley. The coverage started July 1.

Bentley said his administration decided the best route was to let the state’s Division of Risk Management run the program because it runs the program for state employees. The division’s risk manager, Ben Spillers, said the agency contacted at least 18 companies but most weren’t interested. The three or four willing to offer coverage proposed it could be canceled after one claim, which made a state-run plan the most attractive.

AEA did not respond to calls seeking comment. But AEA associate executive director Gregory Graves wrote in an AEA publication July 15 that the Legislature has been trying since the 2010 election to “weaken AEA in retaliation for advocacy on your behalf and for keeping opponents of public education out of power for many years.”

That included passing a law to keep teachers from having AEA dues deducted from their paychecks, rewriting the teacher tenure law, providing tax credits for some private school students and discontinuing a deferred retirement option for public employees.

Before the 2014 legislative elections, he wrote that “they’ve tried everything they can think of to kill your professional association.”

Education employees who join AEA receive liability insurance as one of the benefits of membership. In addition, city and county school boards got liability coverage for their school employees through the Alabama Association of School Boards and its affiliated Alabama Risk Management for Schools.

ARMS administrator Dwight Hester said the school board association never opposed the Republicans’ plan. “We looked at it as an appropriate benefit for the state of Alabama to provide employees of local boards of education,” he said.

He said ARMS dropped coverage for school employees on July 1, but is continuing to offer it for school board members not covered by the new state plan.

He said the $5 million appropriation for the first year amounts to more than $50 per covered employee, while school boards paid ARMs about $7 per employee for similar coverage. He said the new program has start-up expenses and needs to build reserves for the possibility of a big claim in future years, but taxpayers ought to become concerned if the $5 million appropriation gets repeated year after year.

Spillers said the program needs money in hand because court cases take about six years to be resolved.

Hester said he’s concerned that the state program’s unofficial guidelines say it won’t cover most claims brought by a school employee or former employee against an employee covered by the insurance, which were half of his program’s claims over the last decade. “If you’ve got that exclusion, you’ve only got half the coverage you need,” he said.

Spillers said the state teachers’ plan includes that exclusion because AEA’s plan has the same exclusion, but the state employees’ plan does not have that exclusion.

Even though education employees had liability coverage through ARMS, most still joined AEA. Hester figures that will continue with the new state insurance coverage. He recalled that former Gov. Fob James provided liability coverage for teachers for two years more than 20 years ago, and AEA leaders reported no decline in membership. He said the reason is that most education employees join AEA for its advocacy work at the state and local level, not its insurance.

“I don’t think that determines its membership in significant numbers,” he said.

Topics Training Development Alabama