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Reduce your premiums through effective loss control, injury prevention, and accident analysis.

Insurance pricing is crazy low right now.  Insurance markets are continuing to see profits all along each product line from property to international casualty.  At the same time, however, insurance program buyers are NOT taking full advantage of the services and improved terms offered by competing markets.  That being said, today’s article will focus on the first point, services – in particular, risk control or risk prevention services.

What are risk control services?  Well, risk control services are those activities aimed at reducing or eliminating loss exposures in and around your workplace.  Elements may include physical safety assessments, safety program evaluation, ergonomic studies, industrial hygiene analysis (workplace environment exposure analysis), noise level testing and evaluation, claim review/loss analysis, fire protection storage analysis, emergency evacuation study, and those listed are just to name a few.

But Brian, our company has an excellent OSHA compliance program.  We have minimal lost time accidents and our programs audit very well according to our safety team.  That is great, but it is not nearly enough.  Here is why…

When it comes to OSHA compliance, it is the MINIMUM.  OSHA compliance does not take into consideration the cost of loss to the company.  It only considers programmatic elements of safety activity – all measured by metrics or performance standards.  Risk control and risk prevention looks at the loss picture provided by a thorough analysis of your company’s operations.  Risk control will consider the cost of each loss in terms of actual dollars from the claim costs to indemnification of the injured worker.  Take for example the cost of a broken wrist due to poor housekeeping in and around a stairwell.  An employee trips and falls over boxes that have been placed there as a staging area.  This fall result in the worker falling forward, fracturing the right wrist.  The actual cost of medical treatment, rehabilitation, lost time, worker replacement, and lost wages all easily exceed the fine likely imposed by OSHA for a violation.  But many companies still look at OSHA as a measure of success and comply as a fear of fine.  All of which is valid, but off the mark when it comes to reducing the cost of loss and prevention of injuries.

How could risk services helped in preventing such a loss?

  1. Physical walk thru of the workplace.
  2. Assisting the company with a safety committee and inspection team to ensure routine, consistent inspection.
  3. Claim review to identify whether or not similar losses have occurred in this area before.
  4. Interviews with the shipping manager on staging areas and overall process flow.
  5. Safety committee notes review to uncover outstanding items listed and identified from previous assessments.

How could OSHA inspections helped in preventing such a loss?  It likely couldn’t.  OSHA inspections look at activities and programmatic elements.  Physical site assessments may be present, but may limit its scope to written policies and procedures.

In conclusion, consider the services offered by your agent/broker/insurance carrier from their respective risk control consultants.  Cost for these services are typical minimal, if not free.  Many insurance programs will consider 1.5% to 2.5% of the premium as the amount they may consider for risk control services.  For a company paying premium in the range of $100,000 that translates into $1,500 to $2,500 in service fees that may be left unused.  The typical cost for such services is $150.00/hour providing anywhere from 10 to 16 hours of risk services.  All you have to do is ask.