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School Trips and Visits - Insurance and Contractual Considerations

Dear All
 
I’ve been receiving various queries about school trips and visits and what the position will be if those trips or visits are cancelled because of COVID-19.
 
From an insurance perspective, our policy will respond where a Government restriction is put in place which prevents the trip from taking place. The most usual example of this is travel abroad, where the Foreign Office puts specific restrictions in place on travel to specific countries.
 
We anticipate that the policy may cover the situation where a trip or visit is cancelled because the Government has advised against unnecessary travel and mass gatherings but we are mindful that the Government has not yet advised specifically on school closures, which could mean that insurance does not cover the situation where a trip or visit is cancelled by the school.
 
It is also worth noting that if a school takes the initiative to cancel a trip because they are concerned about COVID-19, without any specific Government advice to do so, this would be classed as “disinclination to travel” and would not be covered by insurance.
 
I’ve also checked with my legal services colleagues about the contractual position regarding cancellation. If providers cancel forthcoming trips or visits, they are likely to invoke Force Majeure clauses in their contracts. Clauses do vary so you should take advice on the specifics of your situation.
 
Generally speaking, schools will need to consider whether epidemics/pandemics are covered by the list of Force Majeure events and secondly whether the provider is justified in cancelling the trip or visit because the occurrence of this event prevents or hinders them from performing their obligations under the contract. If these requirements are fulfilled, the school will need to review what the contract says will be the effect of cancellation.
 
Normally the intention of Force Majeure clauses is to release the affected party from their contractual commitments. If the contract does not specify exactly what happens in the case of a cancellation for Force Majeure, the general common law position is that “costs fall where they lie” meaning that costs incurred or payments made will not be recoverable from the other party. If the full balance for the trip or visit has not yet been paid, the school may be expected to fulfil the contract and could be found in breach if it does not pay any sums owing.  However, in these circumstances, the statutory framework around the law of frustration may apply. This tries to guard against so-called “unjust enrichment” where the loss falls unreasonably too much on one party.
 
Clearly this is a concerning position for many of our schools and my general advice would be not to cancel any trips or visits in advance of specific Government restrictions which directly affect schools. If your provider seeks to cancel under Force Majeure, schools should review the contractual position, with specialist support from Legal Services if required, and work with the provider to explore alternatives to cancellation. It may be the case that some providers are willing to offer refunds or other remedies over and above what is required by the contract.
 
If schools do wish to submit a claim under the schools travel policy, please contact my colleagues at Salford City Council via ask.insurance@salford.gov.uk for a claim form.
 
Thanks and regards
Alison
 
Alison Weir
Risk and Insurance Manager
Corporate Services
Warrington Borough Council
 
5th Floor, Quattro Tower, Buttermarket Street, Warrington, WA1 2NH
01925 442613 | 07962 266792 | Alison.Weir@warrington.gov.uk

18 Mar 2020

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Alison Weir
Insurance Service
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