Navigating Risk Management in Education: Strategies for 2025

Construction Education Construct a resilient future using a strong risk To pass the test on risk management, educational management approach as a blueprint for success. institutions must develop a new curriculum. Risk & Insurance | Employee Benefits | Retirement & Private Wealth Risk & Insurance | Employee Benefits | Retirement & Private Wealth

What to Expect in 2025 What to Expect in 2025 Adic to consed qui volorio voluptatus est, int, id mo iuntusa ndent. Educational institutions continue to navigate a growing list of complex Et quis aut dolor aut apicidemquis eum solenti con pores sumquas risks, which may include intense financial pressures, campus safety pedionsequia doleste veliquae et aliquis de sit laut quia dolorunt, challenges and issues related to educator and student mental health. conemol orruptatem et, occuptamus repelignam, omnis de in cust The increasing adoption of artificial intelligence is creating other vellam volupitia non corerro bla ditest que elicilisto quis maxim exposures educational leaders cannot ignore. Educational institutions nonecto eossitiures nobit, simet ullab incium, ulla volest ofÏctur? that prioritize risk education and implement effective risk management strategies can move to the head of the class. Profitability 1 vellam volupitia non corerro bla ditest que vellam volupitia non corerro bla ditest que bla ditest que vellam bla ditest que vellam 88% Vitality The amount of educational institutions saying they are 2 vellam volupitia non corerro bla ditest que vellam volupitia non highly to cautiously optimistic about their organization’s corerro bla ditest que bla ditest que vellam bla ditest que vellam performance and prospects in 2025, the highest confidence 1 level reported by any industry surveyed by HUB. Resiliency 3 vellam volupitia non corerro bla ditest que vellam volupitia non corerro bla ditest que bla ditest que vellam bla ditest que vellam 1. United Educators, “Large Loss Report 2024,” accessed October 10, 2024. Sustainability 4 vellam volupitia non corerro bla ditest que vellam volupitia non corerro bla ditest que bla ditest que vellam bla ditest que vellam 22

PrEofitabilityconomic Viability Sendant vNavigating emerolorerunt autaging quibeaquam, optur?risks while facing financial Menitae mo il inisuncertainty. tiunt volentem. Bus dolorOngoing financial challenges cesed qui ut omniae volor rontinue tesequi cuptao pressurte the e mporbudgets of educaerr ovidus et quam nonsequ odistional institutions as higher opertemque endebisimus ating inctcosts rem quaelated tte cum ad ut quid magniendae optasi doleso salaries and overhead, campus safety, t, vtechnologyel et laut oc, insurcustance mpose and fsimincta dolectacilities maintem es nullisi enance show nimenda ano signs of easing. Ttem comnis sequahe declining enrtiae mosam aspisquam ollment trend is fugiaecus doluptia cus doluptaaccelerating financial issues for some academic instem. Udit laborit eum a sita titutions, qui vparticularly those in higher educaolupti orectemolore maxime sitia quid magnia denihil tion. Enrollment in ma vpostsecolesondary educatet hilliquo conet vtion weras 10% looritis eum di vwer in the felendi acall of 20cupta 22 2 Lower birth rates, rising tuition quam dolupta tionesthan in the fall of 2012.t, od ut maion exceper ciendi ofÏci and reduced confidence in higher education in general reritas nihicit, quam, vellabores evelit, num cum, ullacit will likely result in further declines in college enrollment iume nossi dici dolum ut lata cor aut eius dolorae. Itas Educational institutions should work with their insurance Unt, voluptat. Harioremodit quat listisim fugit et pro in 2025, or what some segment experts refer to as an moditi consernam lautati nctur? broker and use data analytics and predictive modeling to tenecae vent id el idebitiorero magnis sit, seque nos 3 Case Study “enrollment cliff.” assess if their current insurance program is appropriate Deligento etur re, ut que esed mo eos volore, omnis qui magnim es modigni hiliqui cus, nes audis et rem dolorro Record high input costs in 2023 are for their exposure or if other risk transfer solutions may As educational institutions navigate these financial consed maximil ipicaborem si omnis alic tem sam qui ommolupta sum eum ea quunt voluptatae esti conecte be better able to meet their needs at a more affordable simus dolupta tiisti dolorepudita delibus mint litatur, strains, the risks they face are also on the rise, including expected to continue through 2024, ducit parunt. cost. A best-in-class broker with dedicated expertise in cybersecurity threats, infrastructure vulnerabilities, campus vero blam sit, optatem ut elitis ipsunt ut quatem harum affecting all agribusiness, not just farms. Ga. Vid uta duntiis sa volores cienis doluptio que maion the education sector can help evaluate alternative risk safety and increasing sexual abuse and molestation doluptae inihicabor sequi venestetur a volupta voluptusa reri berchictatis quia ipsum deliquatur mincte necabores financing strategies or suggest other creative options liability concerns. According to the HUB International 2025 cuscia volorro doluptatur mod ex estem ut mo tem ius eius voloruntor reperion porpore cuptatur ame se cus to help an institution’s insurance dollars go further. This Outlook Executive Survey,4 increased costs, business accum is cus, ofÏciatio te denis sinciet ut odi bercipsam exero vollaccati reius, voloreris ut doluptaero to ius plam can include the use of parametric insurance for unique disruption and cyberattacks are the greatest risks to Et im haris serferum eatur, to et quibus iniendus eaque fugit volorehendis sa es nihitat empedit voluptur, te sim exposures, such as hail and earthquake, and the use of financial stability facing educational institutions. However, nobissequae litaeri voloremod etur as non rerum fugiasp aut vel iuntibusda dunt, andundam dollabo reptatur mi, captives for both commercial insurance and employee less than 30% of respondents have developed an action erferciis dias sequi nonecab imus aut quo dolupti conecum qui nihitiuntem fuga. Ehendiandit que diae. benefits. plan to address these risks, and only 21% have enough busandae sam, non cus. Ut aut endit eium, sin rehentorias earitatior sequodiore insurance coverage to protect their resources and data in peliquae maximenduci ditat volectur? the event of a cyber incident. 2. National Center for Education Statistics, “Back-to-school Lupta que doluptus aliquiae non rem explitia velliamusam 1. Namstatis ticset eum,” ac vcenditessed lac Septesseember non c8,on 2024. nobisque cum facimus et Along with rising losses come significantly higher insurance maion cusam et dunt omnist quiae omnihitem. evendaest, estotae volupta tendem aut que minulle 3. The Hill, “College enrollment could take a big hit in 2025. Here’s premiums and limited capacity for many coverages, 2. Namwhy,” et January eum v endit10, 2024. lacesse non con nobisque cum facimus et Case Study nihilliqui doluptatiae parumqui quodictem voluptae videl maion cusam et dunt omnist quiae omnihitem. specifically in the areas of sexual abuse and molestation 4. HUB’s Outlook Executive Survey polled 900 C-Suite and VP-level maximil luptassit ea sequasi optio occatur, ut la nos dolore 3. Namexecutiv et eumes on v enditthe is sueslaces fseacing non themcon nobisque on profitability cum f,acimus emplo yetee and in relation to large nuclear verdicts. Academic leaders Record high input costs in 2023 are expected to continue through 2024, affecting all sandis earum necest vel milicim intorehenis nonsequo maionvitality cusamand or ganizaet dunttional omnis resilienct quiaee omnihit. em. who work proactively to reduce their risk can help reduce agribusiness, not just farms. beatem facerfe rferes eos magnien ienesequi id quat insurance costs and improve an institution’s insurability. quibea cum quatia con rem eos earibus il magnaturibus seque ne non plibus, ullupidus eaquo to qui dolorep eratur? 33

Vitality Supporting educators with enhanced benefit options. High levels of stress among educators remain a top issue since the COVID-19 pandemic as faculty and staff Case Study continue to deal with ongoing mental health challenges, the increased politicization of the educational system and A HUB charter school client with 7,000 gaps in student learning. students and 900 employees received a 53% At the K-12 level, 77% of educators reported their job is increase on renewals and could no longer 5 “frequently stressful,” and 68% said it is “overwhelming.” sustain its fully funded health insurance In higher education, 60% of faculty reported feeling stress, plan. By moving to a HUB Charter self- anxiety or depression, and 53% considered leaving their funded health plan, the school reduced its 6 jobs because of burnout, increased workload and stress. administrative burden and accumulated These factors, as well as strained resources and concerns reserves of more than $2 million. about campus safety, are impacting the sector’s ability to attract and retain new teachers. In fact, 52% of K-12 teachers said they would not advise a young person to 7 enter the profession. A self-insurance program can help academic institutions Low morale in the education sector is likely affecting reduce employee benefit expenses. According to the HUB employee productivity, which was noted as a key priority survey, 28% of academic institutions have implemented that needs to be addressed by 67% of education sector a self-funded benefits model while 17% have moved to a respondents in the HUB survey. captive insurance model. Though educational institutions may find it difÏcult to compete with other industries when it comes to salary, 5. Pew Research Center, “What’s It Like to be a Teacher in America advancing institutions provide robust and personalized Today?” April 4, 2024. employee benefit options to faculty and staff that 6. Campus Safety Magazine, “College Faculty Burnout: The Statistics supports attraction and retention. According to the HUB and Solutions,” February 16, 2024. survey, the benefit strategies that have the most traction 7. Pew Research Center, “What’s It Like to be a Teacher in America Today?” April 4, 2024. within the education sector are mental health care, auto enrollment in benefits, offering personal, home and auto insurance and lifestyle insurance programs. Conducting a Workforce Persona Analysis™ and leveraging analytics tools can offer key insights into the benefits that faculty and staff would most likely want and need as well as how to deliver a personalized Quality Employee Experience (QEX). 4

RVesiliencitality y A proactive approach to risk management is essential. The financial performance and reputation of educational institutions are directly impacted by their ability to mitigate and manage risks, making it critical that they improve their organizational resilience. There are five key areas of focus for institutions to proactively address: Campus Safety: Academic institutions must continuously monitor new and evolving threats to campus safety, such as active assailant, student protests and civil unrest, and have a robust plan in place to protect students and faculty from these types of events. An insurance specialist in the education sector can help educational institutions Artificial Intelligence (AI): According to the HUB survey, establish effective campus safety procedures and evaluate only 30% of educational institutions see AI as a top risk the risk of student harm from incidents like sexual abuse to their viability, but there is no question AI technology is and acts of violence due to civil unrest or active shooters. having a significant impact across the educational sector. They can also assist with developing risk mitigation By understanding and embracing AI’s many advantages, strategies to prevent these incidents from happening including its ability to automate and streamline core and implement a crisis response plan should a dangerous operations and help preserve academic integrity, situation unfold. educational institutions can become true leaders in this space. A robust AI governance strategy that is developed Sexual Abuse & Molestation: Long-standing challenges and followed by all key stakeholders will help organizations stemming from incidents of sexual abuse or molestation actively manage this evolving risk. also require proactive planning and constant attention. With a 225% increase in large losses related to sexual Cybersecurity: With educational institutions possessing 8 volumes of highly sensitive information for both minors abuse against higher education institutions since 2012, leaders of educational institutions can’t afford to not invest and adults, the impact of a cyber incident could be in proven abuse prevention practices. catastrophic. Institutions must take their cyber hygiene seriously with a strongly enforced policy for managing Mental Health of Staff and Students: A 2023 study cites device and network security, along with having a crisis rising rates of severe depression, anxiety and stress among response plan ready should an event occur. 9 college students, faculty and staff, and the need for more support services is across the board, not just for one group. While staff are trying to address the needs of their 8. Praesidium, “Praesidium SML Report 2024,” accessed October 10, students, they’re not able to get help for themselves, only 2024. exacerbating the issue. 9. neaToday, “The Mental Health Crisis Among Faculty and College Staff,” March 7, 2024. 5

NameVitality, Image and Likeness Navigating a new world of financial, compliance and power shift challenges. The evolving Name, Image and Likeness (NIL) regulations for student-athletes introduces a new environment rife with opportunities and risks for higher education institutions. Under these regulations, student-athletes in Division I and II schools can now earn compensation from endorsements, social media promotions and public appearances. However, this landscape introduces compliance challenges due to varying state regulations 10 and the need for alignment with NCAA rules. From a risk management perspective, NIL impacts institutional finances, as donor funds are diverted to athletes instead of traditional university channels. It has also given rise to collectives and agents, which may exploit students’ lack of financial literacy. Mismanagement of NIL earnings can lead to tax implications, legal issues and reputational damage for both athletes and institutions. The dynamic also shifts power balances, potentially affecting recruitment and leading to increased athlete transfers between schools. This instability could disrupt funding mechanisms and donor relationships, ultimately impacting the institution’s bottom line. In addition, NCAA athletic revenue share parameters will also put significant financial strain on many institutions across the country. To mitigate these risks, universities should work with a best-in-class broker with sector expertise to prioritize providing financial education, like HUB FinPath or working with a wealth advisor, and establishing compliance frameworks. Forward-thinking institutions may also explore private equity partnerships to offset funding gaps, ensuring a sustainable financial future. 10. New York Times, “How Rich Donors and Loose Rules Are Transforming College Sports,” October 21, 2023. 6

Navigating Your Next Steps Navigating Your Next Steps HUB construction insurance, risk management and employee benefits HUB education industry insurance, risk management and employee benefits specialists will work with you to develop a tailored strategy that will protect specialists will work with you to develop a tailored strategy to protect your the bottom line, support your workforce and build resiliency for 2025. Here bottom line, support the vitality of your workforce and build resiliency for are some initial considerations: 2025. Here are some initial considerations: Making risk management a pillar of your organization’s culture Enterprise risk management (ERM) can help educational Develop a can help identify exposures and develop response plans in case Develop a institutions identify exposures, placing your organization in 1 comprehensive of any type of incident, whether that is a weather-related event, comprehensive the best position to respond in case of an incident. Make sure 1 risk plan. a threat of physical safety or a cyberattack. Make sure your risk plan. your broker understands how to approach risk strategically and broker understands how to approach risk and can identify gaps identify gaps in your institution's coverage. in insurance that could disrupt your daily operations. To compete for a shrinking pool of skilled labor, personalized benefits Create a Employees expect organizational support for their health, safety and based on HUB Workforce Persona Analysis and data analytics can Create a wellbeing. Schools with a benefits strategy based on personalization personalized help your company differentiate itself from the competition. Creating 2 personalized and fostering quality employee experiences (QEX) will boost 2 benefits a quality employee experience (QEX) will boost engagement, improve benefits strategy. engagement, recruitment and retention, and lower risk. strategy. recruitment and retention and promote worker wellbeing An incident can be devastating to your institution’s reputation. Remain Safety is already the focal point of your operation, but with Rely on your Take advantage of your broker and insurer’s expertise if focused on an influx of new and less-experienced workers, injury risks 3 broker and an event occurs. They can assist with legal counsel, crisis 3 workplace increase. Work with a risk professional to review your safety carrier in a management, digital forensics and other issues that arise in safety. program at least annually and address any issues. crisis. case of an incident. Consistent communication with your insurance broker will help Stay in contact with your broker and let them know about identify and mitigate issues in advance of the next insurance Be transparent changes to the business to eliminate surprises at renewal. Be transparent renewal and position your institution in the best light. Review with your Review exposures and insurance needs at least 90 days prior 4 with your exposures and insurance needs at least 90 to 120 days prior to 4 broker. to policy renewal to allow your broker to find the optimal broker. policy renewal to allow your broker to find the optimal mix of coverages for your organization. coverage for your educational institution’s needs. 7 7

[IndusEducatry] Industion Ratry Rate Guide te Guide — U.S.— U.S. HUB International’s rate guidance comprises an analysis of proprietary national survey data and HUB International’s rate guidance comprises an analysis of proprietary national survey data and interviews with HUB commercial insurance brokers and risk services consultants who specialize interviews with HUB commercial insurance brokers and risk services consultants who specialize in the in education. construction industry. On average, rates for middle- to upper-middle-market companies are experiencing rate increases for On average, we are experiencing modest rate increases for nearly all coverages as carriers need nearly all coverages as carriers need additional premium to support increased losses and expenses. additional premium to support increased losses and expenses. Below are projections of rate increases Below are projections of rate increases that we anticipate in 2025. Discuss your business exposures with that we anticipate in 2025. It’s important to discuss your business’ exposure with your insurance broker your insurance broker and understand what to expect well in advance of your next renewal. and understand what to expect well in advance of your next renewal. Coverage 2025 Education Insights Coverage 2024 Rate Guide Insights Rate Guide Expect rates to rise due to increase in loss trends and more Empor am res denietur ra veriae voloreceriam aut ad ut flexibility with loss-sensitive or deductible programs. Some carriers asperch iciunt, quiae nonseque plab ipsam se este int etur may offer more attractive terms in a multiline primary casualty sum voluptatemos sit eliquibeaquo eum exceremped etur sum program that includes workers' compensation. Lorem ipsum  -0% to  +0% inverio nsequib usandit qui conecto cus rem quatur sectiatem illant evel minture qui res perfereped qui corehen istiati squibea Underwriters will focus more on the number of passengers, not tescipsunti occus re es dolorer ferspietur, sunda volecer namende just the number of vehicles. Carriers remain reluctant to increase Commercial Auto +5% to 15% sandae. Ecus maion conseni taquiae rferro doluptiat volorem qui primary limits as requested by insureds with large passenger comnisquas restrumet. vehicle exposures. Empor am res denietur ra veriae voloreceriam aut ad ut Carriers will scrutinize exposures specific to hired and non-owned asperch iciunt, quiae nonseque plab ipsam se este int etur auto coverage; they will track and underwrite to the number of sum voluptatemos sit eliquibeaquo eum exceremped etur sum miles employees drive on their personal vehicles. Lorem ipsum  -0% to  +0% inverio nsequib usandit qui conecto cus rem quatur sectiatem illant evel minture qui res perfereped qui corehen istiati squibea General liability coverage can extend beyond just premises tescipsunti occus re es dolorer ferspietur, sunda volecer namende operations. Specific to education, the coverage also contemplates sandae. Ecus maion conseni taquiae rferro doluptiat volorem qui abuse and molestation and professional liability exposures, which comnisquas restrumet. are continued challenges from an underwriting perspective. Expect to demonstrate appropriate protocols to manage abuse Empor am res denietur ra veriae voloreceriam aut ad ut risks, such as screening, supervision and channels for feedback. asperch iciunt, quiae nonseque plab ipsam se este int etur sum voluptatemos sit eliquibeaquo eum exceremped etur sum General Liability +5% to 15% The uptick in employment practices liability claims from teachers inverio nsequib usandit qui conecto cus rem quatur sectiatem Lorem ipsum  -0% to  +0% whose contracts were not renewed are contributing to increased illant evel minture qui res perfereped qui corehen istiati squibea rates. tescipsunti occus re es dolorer ferspietur, sunda volecer namende sandae. Ecus maion conseni taquiae rferro doluptiat volorem qui Expect more scrutiny from underwriters on risk quotes and comnisquas restrumet. capacity, especially for abuse and molestation, traumatic brain injury, law enforcement and security exposures — as well as Empor am res denietur ra veriae voloreceriam aut ad ut sororities and fraternities in higher education. asperch iciunt, quiae nonseque plab ipsam se este int etur sum voluptatemos sit eliquibeaquo eum exceremped etur sum While workers’ compensation remains generally profitable, inverio nsequib usandit qui conecto cus rem quatur sectiatem Lorem ipsum  -0% to  +0% education’s aging workforce remains an ongoing concern, illant evel minture qui res perfereped qui corehen istiati squibea especially as slip-and-fall claims are on the rise. Workers' tescipsunti occus re es dolorer ferspietur, sunda volecer namende -3% to +7% Compensation sandae. Ecus maion conseni taquiae rferro doluptiat volorem qui Increased workplace violence and classification of workers as comnisquas restrumet. either employees or independent contractors are possible factors in rate changes. Empor am res denietur ra veriae voloreceriam aut ad ut asperch iciunt, quiae nonseque plab ipsam se este int etur Capacity remains the biggest concern due to social inflation as sum voluptatemos sit eliquibeaquo eum exceremped etur sum most carriers have reduced limits offered. For programs needing Umbrella & Excess inverio nsequib usandit qui conecto cus rem quatur sectiatem Lorem ipsum  -0% to  +0% more than $5M in coverage, it’s becoming more difÏcult to build Flat to +15% illant evel minture qui res perfereped qui corehen istiati squibea Liability a tower and coverage for abuse and molestation and student tescipsunti occus re es dolorer ferspietur, sunda volecer namende wellness programs, while traumatic brain injury can be sublimited sandae. Ecus maion conseni taquiae rferro doluptiat volorem qui within the umbrella. comnisquas restrumet. 88

Education Rate Guide — U.S. Coverage 2025 Education Insights Rate Guide Results reflect market recovery and depend heavily on account metrics (occupancy, business class, loss control, catastrophic exposure, claims history, etc.). Accounts that are non-renewed by incumbents, particularly single-carrier placements, will continue to see less favorable results, such as larger rate increases and/or increased deductibles or retentions. Commercial -10% to +10% As construction costs continue to rise, insureds should review Property property valuations each year. Expect an increase in deductibles associated with water damage policies, as some will exclude coverage or increase deductibles for sewer and drain issues. It’s becoming more common that insureds require deductibles per building — not an event — specific to freeze/thaw conditions. Wind and hail deductibles are also increasing. While rates in certain geographies have stabilized, there are exceptions — especially for wind- and earthquake-exposed accounts that have seen drastic run-ups in rates and premiums during the hard market cycle. Carriers remain focused on valuations, driving increased costs for some insurance programs. While signs point to a softening market with specialty carriers, the Catastrophic Perils -10% to +10% standard is still working to achieve adequate rates on their book. More commonly are dollar (flat) deductibles transitioning to a percentage of coverage. Severe convective storms and wildfires remain significant concerns for underwriters, with a major focus on the Atlantic wind season that concludes in November. Flood limits are now typically capped at $5M. Class action lawsuits are prevalent within education, especially copy-and-paste or antitrust suits. Specific to employment practices liability, wrongful termination actions are the most Educators Legal frequent source of litigation given the amount of stafÏng & Management Flat to +15% reductions from budgetary constraints followed by challenges for Liability campus unrest. As institutions begin changing the pedagogy or curriculum to respond to budget challenges, there could be an impact to the number of lawsuits. While renewal premiums continue to fall, underwriters remain selective in the education sector and require more controls. Cyber -10% to +5% Breaches and outages of significant service providers (i.e., Change Healthcare and Crowdstrike) haven’t led to rate hikes yet but may point to harder market conditions in the first half of 2025. NOTE: Rate is typically defined as the amount of money necessary to cover losses and expenses while providing an insurance company with a profit for a unit of exposure. Exposure refers to a business’ or individual’s susceptibility to various daily risks. Carriers evaluate the level of risk an insured faces in calculating insurance premiums. 9

HUBHUB EEducaducationtion When you partner with us, you’re at the center of a vast network of experts who will help you reach your goals. For more information on how to manage your insurance costs, reduce your risk and take care of your employees, talk to a HUB education insurance specialist. $350M in commercial insurance premium brokered by HUB 14,000 insurance policies managed 4,300 education clients Stay up to date Subscribe to receive risk and insurance insights and event invitations throughout 2025. Subscribe hubinternational.com