Purpose

The approval of the
commencement of a compliant procurement process to procure a
36-month contract, for the provision of property buildings
insurance for leasehold properties managed by South Essex Homes;
and
 
To delegate authority to the
Director of Financial Services, to award the contract in accordance
with the outcome of the procurement exercise and take all necessary
steps to facilitate the implementation of that contract.
 

Content

1. That the commencement of a
compliant procurement process to procure a 36-month contract, for
the provision of property buildings insurance for leasehold
properties managed by South Essex Homes be approved.
 
2. That authority be delegated
to the Director of Financial Services, to award the contract in
accordance with the outcome of the procurement exercise and take
all necessary steps to facilitate the implementation of that
contract.

Reasons for the decision

1. The insurance is required to create a
financial risk control mechanism to protect the value and integrity
of the buildings owned by Southend on Sea City Council and leased
back to various leaseholders.
 
2. This contract provides property insurance
to the leaseholders of South Essex Homes.  If this was not
procured then the Council and South
Essex Homes would have to fund any damage sustained to the
buildings. The market of insurers has reduced in recent years.
Homes. Only one insurer will be appointed. 
 
3. The procurement process is required to
identify, and award a contract to, a preferred bidder to provide
the required Property Buildings Insurance.
 
4. The procurement process will be run on
behalf of the Council by through a Dynamic Purchasing System, with
additional guidance from the Council’s own Corporate
Procurement Team if required. 
 
5. Additional time is required after the
potential award of the resulting contract to allow SEH to consult
and notify their leaseholders on the policy details and costs of
the related insurance.

Alternative options considered

The Cabinet member could decide not to
approach the insurance market for a new property housing leasehold
insurance.  However, this would mean
that after the current years’ insurance policy expires, the
Council would be financially responsible to meet any and all losses
arising from unforeseen events. This would include but not be
limited to fires, floods and other events outside the
council’s control to cover and protect leaseholders by paying
for the associated claims. This option is accordingly not
recommended.