Workers' compensation is one of the only lines of insurance that is a controllable expense. By initiating best practices, safety manuals, and risk reduction strategies you can keep your employees safe and your workers' compensation premium at an all time low.
How does it affect my business?
Workers’ compensation costs depend on the incidents that occur at your facility and can have a powerful impact on your company’s bottom line. It's safe to say that a business with a lot of workers' compensation claims can have a huge impact on your premium.
Another great reminder is that one claim isn't going to affect you and your business for one year, but for three consecutive years. That's right, one claim can lead to three years of extra expenses. Why? Insurance carriers like to see three years of loss run reports. Any claim that happens will be seen for the next three years and your premium will reflect it.
What are key components?
Workers’ compensation insurance premiums are based on the number of losses your company has incurred (frequency of losses) and the amount of money reserved on claims (severity of losses and amount paid). Thus, acting on workers’ compensation costs means focusing on these two fundamental drivers.
Even the best loss prevention efforts cannot completely eliminate workplace injuries. While safety programs contribute greatly, cost containment and disability management programs minimize your workers’ compensation claims costs once an accident occurs. In addition to investing in loss control efforts, prepare for claims by establishing and enforcing return to work programs.
What can be done?
To minimize the frequency and severity of losses, risk managers can take several key steps:
- Allocate funds to the prevention of your facility’s most common injuries.
- Regularly review workplace hazards and safety procedures with employees.
- Create an accident review committee for accidents and near misses.
- Implement a safety incentive bonus program rewarding safe behavior.
Reduce Claims Expenses
Report claims promptly. On average, claims reported more than 10 days after an incident have total incurred values two and a half times higher than claims reported within two days from the date of the incident.
- Conduct accident site investigations to preserve evidence and deter fraudulent behavior.
- Thoroughly document incidents with an accident report form.
- Require witnesses to complete a witness report form.
- Identify local occupational medicine clinics in your network that will provide you with specialized care and medical cost savings.
- Encourage injured employees to seek medical treatment at a chosen clinic upon report of the accident.
If you want to learn how Clarke & Sampson, Inc. can help you and your business control your workers' compensation expenses please contact us today at 703.683.6601. Or submit an inquiry by clicking the button below.