Alabama Sets Up State-Run Public School Teachers’ Liability Insurance Plan

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 until long after schools reopen next month.

A law requiring the insurance was enacted by the Republican-led Legislature and signed by the Republican governor this spring. It capped three years of GOP efforts to weaken the influence of the traditionally Democratic-leaning teachers’ organization.

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 Alabama’s public schools the same liability coverage that state employees have had for many years.

After wresting control of the Legislature from Democrats in the 2010 election, Republicans began trying to pass the bill. They allocated $5 million to pay for the coverage in the first year, and left the details up to Bentley’s administration. The insurance coverage started July 1, although the accompany rules aren’t yet finished.

Bentley said his administration decided the best route was to let the state’s Division of Risk Management run the educators’ program because it runs the program for state employees.

The division’s risk manager, Ben Spillers, said the agency contacted at least 18 companies and most didn’t want to offer coverage. Of the three or four willing to offer coverage, they proposed it could be canceled after one claim, which made a state-run plan the most attractive.

“We’re ready to accept claims,” he said.

AEA did not respond to phone 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.

To encourage education employees to get active in 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 coverage 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 for insurance. “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 because they aren’t 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 normally take about six years to get 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. He said half of his program’s claims over the last decade were filed by school employees against their fellow employees and their school boards. “If you’ve got that exclusion, you’ve only got half the coverage you need,” he said.

Spillers said the state plan includes that exclusion because AEA’s plan has the same exclusion, but he noted the state’s plan for state employees 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.

Retired educator Nancy Worley, a two-time president of AEA, said the AEA’s insurance is an important benefit, but there are many other reasons for joining, which won’t be diminished by state insurance coverage.

“It is not going to make a difference one way or another,” she predicted.