Essex County Council will have to fork out up to £2.8 million of taxpayers' money after its insurance company went into liquidation.
Finance chiefs are creating an emergency fund to meet the potential cost of claims that should have been covered by firm Independent Insurance.
The council took out employer and employee liability cover with Independent between 1993 and 2001, when the company went into liquidation.
Since then, several claims have been made about incidents that happened during the period.
Once a bankruptcy plan has been drawn up to decide how much frozen cash from Independent's coffers can pass to each of its creditors, the council may find it is at least partly covered.
But in the meantime, £2.8 million has been ring-fenced in case all the claims are successful.
Published Wednesday, September 15, 2004
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