Every insurance company that provides workers’ comp insurance provides what they call loss control services. It’s a service that insurance companies have changed a lot over the last 25 or 30 years. In the old days, every insurance company employed industrial hygienists as well as safety professionals, and it was perceived to be a very valuable service for any policyholders because it would help them have fewer claims and manage those claims better, so costs would go down.
Over the years, what has happened unfortunately is that’s a cost that has been cut out. We’ve seen it happening in almost all the major insurance carriers. They write workers’ comp insurance, but they provide very little in terms of meaningful loss control anymore. Although they probably don’t think that that’s the case, most of the loss control they provide are inspection-based services, where they’ll come in and look for conditions that are either unsafe, unguarded equipment or machinery, a forklift that’s got bad brakes, electrical panels that are blocked, or fire extinguishers that are on the floor, and frankly those are not necessarily the things that hurt people.
The majority of the accidents that we see probably more than 95% of them are based on unsafe acts or unsafe work practices. That is people not doing the job the right way, not using the right tools for the job, or deciding that they can do something that they really aren’t trained or qualified to do and end up in the process hurting themselves. We know where the cost of claims comes from, we know that better than 60% of the cost of claims comes from slips, trips, and falls. It comes from people who are lifting, pushing, pulling, and twisting for what they do for work. Awkward postures, ergonomics, and then people are hit by equipment and machinery and that’s all in the process of servicing or working on that equipment and machinery. Those three types of claims result in more than 60% of the cost of not only the claims for the groups that we manage.
If you take a look at workers’ comp policies and industries across the country, there are three similar types of injuries the result in the majority of the cost. So when we go into our customer sites, those are the things that we work on. We know that slips, trips, and falls produce an inordinate amount of cost, so we tend to look at each individual company. We will go in and say ‘where can you have slips, trips, and falls’ and let’s take a look at those conditions, and then let’s take a look at a program to address those.
For example, in our lumber group, we have a number of delivery trucks on the road every day for the lumber yards that we work with and a number of the accidents that they have are slips and trips and falls on people’s job sites, especially in the wintertime when there’s ice and snow problems. So we have a huge effort to make sure that their traction control device is used on the workers feet, the driveways are shoveled, the driveways are plowed, and sand and salt goes down so that we can try to minimize or mitigate those slips, trips and falls. In one year, about four years ago, we had over a million and a half dollars worth of workers comp claims just from slips and trips and falls on ice and snow. So it’s important to us that we focus on those three areas where all of our claims actually occur and the majority of our costs occur. That keeps our cost of claims down which allows us to keep our premium cost down.
Every member of the self-insurance groups that we have sees a loss control person at least once a year, and when you become a member of either one of the trusts that we run you have what we call a roll out where members of our staff come out to inform you as to how we manage your workers comp, and part of that is a lost control assessment. You will then see a loss control person several times a month or a year. We have one of our larger lumberyard customers that has as many as 25 or 30 loss control visits a year and it’s all really predicated upon how much a member company needs our services, what kind of losses they’ve had, and what kind of an impact we can have by helping them out.
To say that it’s customized for all the users that we work with is a bit trite, but that really is kind of what we do. We try to assess the needs of an individual member and then deliver as much loss control service as we think they need based on what they’ve already got in place and what their losses typically look like. But the average trust member will see our loss control people somewhere between two and five times a year, and what’s interesting to note is that an awful lot of the smaller companies that we get into our trust, some of the premiums of 20, 30, $40,000 a year that have been in business for two or three decades, have never seen a loss control person in that entire time. And we kind of scratch our heads to say how can they have never seen a loss control person if stopping losses in the first place is the best way to try to control your workers comp costs.