Custody breaches submission

The recent spate of custody escapes in London has put a spotlight on a risk that some in the insurance market may not think about every day but probably should. When a prisoner walks out of a hospital or slips away during transport, the fallout can be significant. And for public bodies, insurers, brokers and risk managers, the question quickly becomes: who pays?

Most people picture prison breaks as dramatic events. The reality is usually far more mundane. Escapes commonly occur during hospital visits for medical treatment, in court holding areas or from transport vehicles. Hospital settings are particularly vulnerable because security is lighter, the public is nearby and the task often falls to third-party escort contractors rather than prison staff. When something goes wrong, the consequences can be serious. An escaped prisoner might reoffend, harm a member of the public or simply disappear. Any of these outcomes can trigger claims, investigations and difficult questions about who was responsible.

The custody sector involves a mix of public bodies and private contractors, and liability sits differently depending on who is doing what:

Public bodies (police forces and His Majesty’s Prison and Probation Service (HMPPS)) generally self-insure or rely on government indemnity. They hold onto their own risk rather than buy commercial cover.

Private contractors are a different story. Companies providing prisoner escort and transport services under outsourced contracts are typically required to carry substantial public liability and professional indemnity insurance, often with significant limits.

The contracts between public authorities and contractors will (or certainly should) set out who is responsible for what. In most cases, contractors must indemnify the authority if something goes wrong due to their own negligence, for example failing to follow proper escort procedures. But these indemnity clauses can be challenging. If a dispute arises after an escape, it often comes down to the facts: Did the contractor follow the rules? Did the authority give them accurate information about the prisoner’s risk level? These are issues that can take a considerable time to resolve.

For insurers writing this class of business, custody risk is becoming harder to assess and price. This is because:

• Severity is high. If an escaped prisoner commits a serious offence, the resulting claims can be substantial: personal injury, psychological harm, even fatalities. These are not minor exposures.
• Frequency is rising. While escapes remain relatively rare, they happen often enough to keep underwriters on alert. A handful of high-profile incidents can shift market attitude quickly.
• Operational standards vary. Contractors do not all perform at the same level. Some have robust training, proper staffing ratios and clear protocols for high-risk situations. Others cut corners. Underwriters are increasingly focusing on these details before quoting.

Contractors with weak risk management will struggle to find cover and face significant premiums, high excesses and restrictive terms. Those with strong controls are in a better position, but even they may find renewals tougher than a few years ago.

For brokers placing this business, the message is clear: understanding the organisation’s operations is more important than ever. Insurers want to see evidence of training records, staffing levels, incident logs and compliance with Home Office standards. A well prepared submission will be the difference between competitive terms and no terms being offered.

It is also worth having honest conversations with organisations about their contractual indemnities. Many contractors assume the public authority will pick up the cost when things go wrong, but the reality is often more complicated. A gap in cover, or an unexpected policy exclusion, will leave a contractor significantly exposed.

The London escapes have shone a light on custody risk. Expect underwriters to ask tougher questions, demand better risk information and price accordingly. For contractors, investing in proper security and compliance is not just good practice, it is essential for keeping cover in place.

For public bodies, the challenge is different but equally pressing. Self-insurance reserves need to reflect the true cost of potential claims and budget constraints make this harder every year.

Ultimately, custody risk is a shared problem. Public authorities, contractors and insurers all have a stake in the outcome. Getting the risk allocation right and making sure insurance arrangements actually match operational reality is the key to managing this evolving exposure effectively.